JAKARTA – Indonesia and Malaysia have agreed to strengthen their strategic cooperation in increasing trade and investment, and in developing their palm oil industries. The agreement was reached during a meeting between President Prabowo Subianto and Malaysia’s Prime Minister Anwar Ibrahim in Kuala Lumpur, Malaysia, on Monday (27/1/2025).
“During the meeting, President Prabowo said that in every country he visited he was told that they need palm oil. Those countries include Egypt, India, Pakistan. President Prabowo hopes that by strengthening cooperation with Malaysia they can fulfill the rising global need of vegetable oils, especially palm oil,” Indonesia’s Trade Minister (Mendag) Budi Santoso said in a press statement in Jakarta on Tuesday (28/1/2025).
Indonesia and Malaysia are the world’s largest producers of palm oil, contributing around 80% of global supply of palm oil. “We’re ready to implement the cooperation agreement with Malaysia in developing palm oil industries. We hope our bilateral cooperation will also help us in resolving the export problems we’re facing in a number of countries,” the minister said.
Malaysia is Indonesia’s sixth largest export destination and the fifth largest country as the source of imports. During the period of January-November 2024, the total trade between Indonesia and Malaysia reached US$21.06 billion. During the same period, Indonesia’s exports to Malaysia reached US$10.97 billion, while its imports from Malaysia reached US$10.09 billion. It means during the period Indonesia saw a surplus in its trade balance at US$882 million.
Previously, it was reported that the Indonesian government managed to prove the discrimination policy of European Union (EU) against palm oil in the trade dispute at the Dispute Settlement Body of the World Trade Organization (DSB WTO). It is contained in the panel report of WTO issued on 10 January 2025.
Trade Minister Budi Santoso said that Indonesian government warmly welcomed the WTO’s panel decision on the palm oil trade dispute filed by Indonesia against EU at the WTO.
“We hope in the future other countries will not apply similar policy, which is potential to hinder global trade,” Budi said in a press statement on Friday (17/1/2025).
Generally, the WTO panel stated that EU has discriminated against palm oil by unfairly excluding palm oil-based biofuel from Indonesia, while accommodating other biofuel products based on rapeseed and sunflower from EU in its own market. EU has also discriminated the palm oil as vegetable oils by giving advantages and preferences to other vegetable oils, including soybean which is also imported from other countries. (*) Source: sawitkita.id
