Indonesia, Malaysia to visit Brussels over concern about EU deforestation law

JAKARTA (Reuters) – The world’s two biggest palm oil producers Indonesia and Malaysia will send top officials to the European Union next week to voice concern over a new deforestation law they believe could be detrimental to small farming businesses.

Indonesia and Malaysia accounts for about 85% of global palm oil exports and the EU is their third-largest market.

The European Parliament approved a landmark deforestation law last month to ban imports into the EU of coffee, beef, soy and other commodities unless companies could provide “verifiable” information the products were not grown on land that was deforested after 2020.

Those in violation would face hefty fines.

Indonesia and Malaysia both confirmed the visit to Brussels would take place on May 30 and May 31.

Both have accused the EU of discriminatory policies targeting palm oil and Malaysia had previously said it could stop exporting it to the EU over the deforestation law.

The regulation has been welcomed by environmentalists as an important step to protect forests, with deforestation responsible for about 10% of global greenhouse gas emissions.

Indonesia’s Coordinating Minister for Economic Affairs Airlangga Hartarto said the law would burden smallholders with onerous administrative procedures.

“The law could exclude the important role of smallholders in the global supply chain and fail to recognise their significance and rights,” Airlangga said in a statement.

Airlangga will make the Brussels trip with Malaysia’s Commodities Minister Fadillah Yusof. The mission will seek to discuss ways of minimising negative impacts of the law, especially on smallholders, the statement said.

EU diplomats have denied the bloc is seeking to ban imports of palm oil and said the law applies equally to commodities produced anywhere.

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