{"id":21864,"date":"2022-08-24T10:29:10","date_gmt":"2022-08-24T03:29:10","guid":{"rendered":"https:\/\/gapki.id\/en\/?p=21864"},"modified":"2022-08-24T10:29:10","modified_gmt":"2022-08-24T03:29:10","slug":"eus-likely-options-against-wtos-verdict-on-palm-oil-row","status":"publish","type":"post","link":"https:\/\/gapki.id\/en\/news\/2022\/08\/24\/eus-likely-options-against-wtos-verdict-on-palm-oil-row\/","title":{"rendered":"EU\u2019s Likely Options Against WTO\u2019s Verdict on Palm Oil Row"},"content":{"rendered":"

Indonesia and Malaysia say the European Union\u2019s (EU) palm oil restrictions are unfair and “discriminatory” and are hoping for the WTO to resolve the dispute. Meanwhile, the EU has been introducing new limits on using palm oil as fuel.<\/p>\n

\"\"<\/a><\/p>\n

The World Trade Organization (WTO)\u00a0could soon rule on two cases brought against the EU over its decision to phase out the import of unsustainable palm oil by 2030.<\/p>\n

The complaints were filed by Indonesia and Malaysia, the world’s two largest palm oil producers, who slammed Brussels’ Renewable Energy Directive (RED) II as unfair and “discriminatory.”<\/p>\n

The EU has been sending mixed signals on the controversial issue.<\/p>\n

On one hand, its officials have made clear that oil production is a leading cause of deforestation and so cannot comply with renewable energy targets. There is also an issue of pollution \u2014 palm oil diesel releases up to three times as many emissions\u00a0compared to traditional petroleum-based fuel.<\/p>\n

In early July, EU lawmakers adopted draft rules for the ReFuelEU initiative, which would mean 85% of all aviation fuel would have to be “sustainable” by 2050. Palm oil byproducts would not be acceptable. And there is now talk in the European Parliament of bringing forward the final phaseout date for palm oil imports, currently set at 2030.<\/p>\n

At the same time, Brussels has attempted dialogue with palm oil exporters in recent months, including through the ASEAN-EU Joint Cooperation Committee meeting in Jakarta in late June.<\/p>\n

And since the introduction of a renewable energy directive in 2018, the EU’s imports of palm oil have actually increased. In 2021, the EU imported \u20ac6.3 billion ($6.4 billion) worth of palm oil and palm oil products, mostly used for biofuels.<\/p>\n

Indonesia and Malaysia accounted for 44.6% and 25.2% of those imports, respectively. EU imports from Indonesia were up 9% last year, compared to 2020, according to Indonesian government data. Russia\u2019s war in Ukraine, which started in late February, has put additional pressure on Brussels to secure its fuel supply.<\/p>\n

‘Crop apartheid’<\/strong><\/p>\n

The Malaysian and Indonesian governments have also tried to keep their options open in the EU row.<\/p>\n

“Malaysia has often employed both a cordial and confrontational approach over palm oil with the EU, not exclusively one or the other,” explained Helena Varkkey, associate professor at the Department of International and Strategic Studies at the University of Malaya.<\/p>\n

Earlier this year, Malaysian Plantation Industries and Commodities Minister Zuraida Kamaruddin slammed what she called “crop apartheid.”<\/p>\n

“We will show them that Malaysia is not a nation to be fooled around with,” she said.<\/p>\n

Last month, however, she said Kuala Lumpur wants a cordial, “win-win” solution to this problem, referencing the\u00a0WTO.<\/p>\n

“WTO cases take a long time to resolve, so it would still be necessary for countries to engage outside of the WTO during this process, and Malaysia probably sees the benefit of doing so amicably,” said Varkkey.<\/p>\n

And with the dispute ongoing, the Malaysian government is busy finding new markets. During his visit to Kuala Lumpur this month, China’s Foreign Minister Wang Yi vowed that Beijing would increase imports of palm oil from the country. China is currently the world’s second-largest importer of the product, after India.<\/p>\n

WTO verdict<\/strong><\/p>\n

The WTO decision seems to be drawing near. The panel to decide Indonesia’s case was formed in November 2020. A panel of the same members was formed for Malaysia’s case in July 2021.\u00a0Both are chaired by Manzoor Ahmad, Pakistan’s former permanent representative to the WTO. Members are Sarah Paterson, of New Zealand, and Arie Reich, of Israel.<\/p>\n

A senior EU official, who requested anonymity, said they expect a decision before the end of the year.<\/p>\n

If the WTO panels were to rule in favor of Indonesia and Malaysia, Brussels has three options, explained Stefan Mayr, a senior scientist at the Institute for Law and Governance at Vienna University of Economics and Business.<\/p>\n

First, the EU could appeal the panel report. But that could set back a final ruling by years, as any decision would have to come after new members are appointed to the WTO’s Appellate Body. The body is currently not functioning due to the US blocking new appointees.<\/p>\n

The second option, Mayr noted, would be for the EU to comply with the WTO ruling and adapt the environmental policies established by the Renewable Energy Directive II. Whether the EU could make cosmetic changes to its palm oil phaseout, while keeping the essence of the policy, is unclear.<\/p>\n

Lastly, the EU could simply carry on regardless and accept any retaliatory measures imposed by Indonesia and Malaysia.<\/p>\n

This last option, however, doesn’t seem too likely. A senior EU source with knowledge of this issue, who requested anonymity, said: “we will, of course, abide by whatever the WTO decides.”<\/p>\n

Geopolitics and palm oil<\/strong><\/p>\n

If the EU was to ignore the ruling, Indonesia and Malaysia would struggle to retaliate economically, analysts reckon. According to European Commission data, Malaysia is only the EU’s 20th largest trading partner in goods; Indonesia is 31st.<\/p>\n

But another EU official, also not authorized to speak publicly on the issue, speculated that Brussels would not want to\u00a0unnecessarily frustrate two key actors in Southeast Asia, where the EU is keen on boosting its reputation and signing new free trade deals. Because of the energy crisis caused by Ukraine war, the official also expects EU imports of palm oil to continue growing in the coming years.<\/p>\n

Moreover, Jakarta has one more card to play \u2014 it could limit the export of raw materials necessary for the production of stainless steel. The EU brought a case against Indonesia to the WTO on this issue in November 2019.<\/p>\n

“Which option the EU would choose is obviously not a purely legal question,” said Mayr.<\/p>\n

“There are conflicting interests at play and in light of the current geopolitical situation, it seems even more difficult to gauge how the EU would react to an unfavorable outcome in the WTO disputes.” (*)<\/p>\n

Source: dw.com<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Indonesia and Malaysia say the European Union\u2019s (EU) palm oil restrictions are unfair and “discriminatory” and are hoping for the WTO to resolve the dispute. Meanwhile, the EU has been introducing new limits on using palm oil as fuel.<\/p>\n","protected":false},"author":1,"featured_media":21865,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"","neve_meta_content_width":0,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","neve_meta_reading_time":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[3708,3709],"tags":[],"class_list":["post-21864","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-publication","category-recent-news"],"yoast_head":"\nEU\u2019s Likely Options Against WTO\u2019s Verdict on Palm Oil Row - 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Under the EU\u2019s renewable energy directive (RED), palm oil-based fuels are to be phased out by 2030,\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/08\/wto_palmoil_malaymail.com_.jpg?fit=988%2C564&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":25761,"url":"https:\/\/gapki.id\/en\/news\/2020\/06\/09\/gapki-indonesia-has-chance-to-win-case-in-wto\/","url_meta":{"origin":21864,"position":1},"title":"GAPKI: Indonesia Has Chance To Win Case In WTO","author":"admin","date":"June 9, 2020","format":false,"excerpt":"The Indonesian Palm Oil Association (Gapki) is optimistic that Indonesia can win a legal case against the European Union\u2019s (EU) palm oil discriminatory policy in the World Trade Organization (WTO). As previously reported, Indonesia, the world\u2019s largest producer of palm oil, will file a lawsuit to the WTO regarding the\u2026","rel":"","context":"In "Info & Activity"","block_context":{"text":"Info & Activity","link":"https:\/\/gapki.id\/en\/news\/category\/info-activity\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2019\/11\/joko_supriyono_ipoc.jpg?fit=720%2C415&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2019\/11\/joko_supriyono_ipoc.jpg?fit=720%2C415&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2019\/11\/joko_supriyono_ipoc.jpg?fit=720%2C415&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2019\/11\/joko_supriyono_ipoc.jpg?fit=720%2C415&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":29403,"url":"https:\/\/gapki.id\/en\/news\/2025\/02\/25\/wto-confirms-eus-palm-policies-unfair-adjustment-required\/","url_meta":{"origin":21864,"position":2},"title":"WTO Confirms EU\u2019s Palm Policies Unfair, Adjustment Required","author":"admin","date":"February 25, 2025","format":false,"excerpt":"GENEVA -\u00a0Indonesia has secured a victory in an international trade dispute at the World Trade Organization (WTO) after the WTO Dispute Settlement Body (DSB) adopted the final report on case DS593 concerning the European Union\u2019s (EU) policies on palm oil and palm oil-based biofuels. In the final report, which was\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2025\/03\/wto_OMC_cnn.com_.jpg?fit=832%2C527&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2025\/03\/wto_OMC_cnn.com_.jpg?fit=832%2C527&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2025\/03\/wto_OMC_cnn.com_.jpg?fit=832%2C527&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2025\/03\/wto_OMC_cnn.com_.jpg?fit=832%2C527&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":20442,"url":"https:\/\/gapki.id\/en\/news\/2021\/08\/02\/ri-asked-to-intensify-palm-oil-negotiations-with-eu\/","url_meta":{"origin":21864,"position":3},"title":"RI Asked To Intensify Palm Oil Negotiations With EU","author":"admin","date":"August 2, 2021","format":false,"excerpt":"Jakarta -- Market restrictions in the European Union continue to become the main hurdle for Indonesian palm oil exports for the last three years despite ongoing negotiations and efforts at the World Trade Organization (WTO), the industry association said. The government has since 2019 engaged in negotiations with the EU\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/03\/limbah_kelapasawit_kumparan.com_-1.jpg?fit=1089%2C612&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/03\/limbah_kelapasawit_kumparan.com_-1.jpg?fit=1089%2C612&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/03\/limbah_kelapasawit_kumparan.com_-1.jpg?fit=1089%2C612&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/03\/limbah_kelapasawit_kumparan.com_-1.jpg?fit=1089%2C612&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/03\/limbah_kelapasawit_kumparan.com_-1.jpg?fit=1089%2C612&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":19816,"url":"https:\/\/gapki.id\/en\/news\/2021\/02\/24\/eu-ambassador-door-still-open-for-indonesian-cpo\/","url_meta":{"origin":21864,"position":4},"title":"EU Ambassador: Door Still Open For Indonesian CPO","author":"admin","date":"February 24, 2021","format":false,"excerpt":"JAKARTA \u2013 European Union (EU) Ambassador to Indonesia Vincent Piket said that the EU still opens its door for the imports of crude palm oil (CPO) from Indonesia, despite trade dispute at the World Trade Organization (WTO). Piket stated that during the first 10 months in 2020, the exports of\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/02\/william_reed.com_palmoil.jpg?fit=750%2C500&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/02\/william_reed.com_palmoil.jpg?fit=750%2C500&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/02\/william_reed.com_palmoil.jpg?fit=750%2C500&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2021\/02\/william_reed.com_palmoil.jpg?fit=750%2C500&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":28019,"url":"https:\/\/gapki.id\/en\/news\/2024\/06\/16\/opinion-without-dialogs-eu-risks-eudr-not-working-in-southeast-asia\/","url_meta":{"origin":21864,"position":5},"title":"OPINION: Without Dialogs, EU Risks EUDR Not Working In Southeast Asia","author":"admin","date":"June 16, 2024","format":false,"excerpt":"The European Union\u2019s palm oil ban is well underway, and Indonesia and Malaysia are taking action to protect their global palm oil exports,\u00a0filing complaints to the World Trade Organization (WTO). Though pivoting toward a sustainable future, Indonesia and Malaysia cannot phase out palm oil production until they further develop their\u2026","rel":"","context":"In "Publication"","block_context":{"text":"Publication","link":"https:\/\/gapki.id\/en\/news\/category\/publication\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2024\/06\/car_mobil_sawit_thediplomat.com_.jpg?fit=732%2C463&ssl=1&resize=700%2C400 2x"},"classes":[]}],"jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"jetpack_featured_media_url":"https:\/\/i0.wp.com\/gapki.id\/en\/dir-site\/uploads\/2022\/08\/oilpalm_dw.com_.jpg?fit=919%2C510&ssl=1","_links":{"self":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/posts\/21864","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/comments?post=21864"}],"version-history":[{"count":0,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/posts\/21864\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/media\/21865"}],"wp:attachment":[{"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/media?parent=21864"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/categories?post=21864"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gapki.id\/en\/wp-json\/wp\/v2\/tags?post=21864"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}