BRAND LETTER FROM HEADS OF GOVERNMENT:Southeast Asia strikes...

BRAND LETTER FROM HEADS OF GOVERNMENT:Southeast Asia strikes back in the palm oil dispute with the EU
https://www.faz.net/aktuell/wirtschaft/suedostasien-will-palmoel-bann-der-eu-verhindern-16136037.html

BRAND LETTER FROM HEADS OF GOVERNMENT:Southeast Asia strikes back in the palm oil dispute with the EU

• BY CHRISTOPH HEIN , SINGAPORE
• -UPDATED ON 11.04.2019 - 14:10

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The heads of government of Indonesia and Malaysia are threatening the EU with a fire letter. They want to prevent the palm oil ban of the EU and accuse her of "protectionism". At the borders, that already works.

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inthe core countries of Southeast Asia, a crisis is looming in relations with Europe. The dispute over the phasing out of palm oil as biofuel in the European Union by 2030 hits Indonesia and Malaysia, the two largest producers.

Christoph Hein

Business Correspondent for South Asia / Pacific based in Singapore.

• FAZ

Now Indonesian President Joko Widodo and Malaysia's Prime Minister Mahathir Mohamad have threatened sharp consequences in a rare joint letter from the European Union. The first goods from Europe are to be processed only hesitantly at the borders of Indonesia, foreigners report at the same time in the capital Jakarta. The two heads of government say that Europe's "discrimination against palm oil is obvious". The European Commission decided in mid-March that the continued deforestation of the tropical rainforest in Southeast Asia for palm plantations would disqualify oil as a source of sustainable biofuels.

"Our governments see it as a deliberate, calculated and economically and politically harmful strategy to take palm oil out of the EU marketplace," it says in its letter. The letter from the two Southeast Asian Heads of Government is addressed to Donald Tusk , President of the European Council, and Antonio Tajani, President of the European Parliament.

China's arms

The Asians are raising heavy guns. Since they doubt the scientific justification for the ban of palm oil aimed at in Europe, they write of the "probability that political and economic protectionism rather than scientifically based decisions are the real drivers" of the decision. These are harsh words in times when the European ambassadors in Southeast Asia announce that the EU is seeking free trade except with Singapore and Vietnam with the whole confederation of Southeast Asia (Asean).

Malaysian Prime Minister Mahathir Mohamad (l.) And Indonesian President Joko Widodo (r.) :Image: dpa

But it gets worse. "Should regulation come into force, our governments will put our relations with the European Union as a whole as well as with their member states to the test," they threaten in the fourth paragraph of the letter. "This could include the review of our partnership negotiations, supply contracts and key imports from the EU."

Connoisseurs of the situation say that about the order for military aircraft Airbus A 400M could be affected. Indonesia announced a year ago to buy two of the machines. "Our decision could drive Indonesians and Malaysians further into the arms of China," warn European circles in capital cities. The Asians are talking about the lobby of the French rapeseed oil farmers and the soybean farmers in America, they have outrun. The European Parliament argues that illegal agriculture accounts for 49 percent of the deforestation of tropical forests.

Cleared land on a palm plantation in Johr in Malaysia :Image: Reuters

A few days ago, Mahathir and an Indonesian minister had been publicly discussing the cancellation of orders for Airbus. Already some European dealers in Jakarta report that French and British goods in particular are being processed more slowly at the border. Paris had already campaigned against the benefits of palm oil before the other European countries . "We're talking about wines, whiskey and champagne, which can easily be replaced with Australian products," it says. Some German goods are also affected - something the global freight forwarder DHL Deutsche Post has not been able to confirm.

The two heads of government warned that they would bring the palm oil ban to the Dispute Settlement Committee at the World Trade Organization (WTO). "The EU has decided to ignore our continued efforts to achieve the United Nations agenda for achieving sustainable development goals by 2030, our national commitments to preserve the forest, sustainable palm oil production and, in particular, our efforts to combat poverty, especially in rural areas" , write the politicians.The lives of more than 13 million people depend on palm oil in Indonesia and Malaysia. "This is about key national interests," warn Mahathir and Widodo. The Indonesian president has to stand for election next week. Mahathir won the election last year, but the 93-year-old Prime Minister faces a growing opposition in his own country...................................

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