Looking Ahead to the EU-ASEAN JWG on palm oil. Will Indonesia get final say?
Indonesia’s powerful lobby group, GAPKI – Indonesian Palm Oil Association – has reiterated its position in advance of the EU-ASEAN Joint Working Group on palm oil which is to be held in January 2021.
For some background information, read our previous post on the EU-ASEAN Strategic Partnership.
GAPKI has made its position clear in a blog post that stated among other things:
“To be clear: the Indonesian palm oil community broadly supports policies to prevent deforestation, and believes that this should take place with enforcement and compliance at the domestic level. An indirect measure that curbs trade and exports from developing countries to the European Union – such as a unilateral EU regulation – will not stop deforestation, and will instead undermine efforts to combat it.”
For some background information, read our previous post on the EU-ASEAN Strategic Partnership.
GAPKI has made its position clear in a blog post that stated among other things:
“To be clear: the Indonesian palm oil community broadly supports policies to prevent deforestation, and believes that this should take place with enforcement and compliance at the domestic level. An indirect measure that curbs trade and exports from developing countries to the European Union – such as a unilateral EU regulation – will not stop deforestation, and will instead undermine efforts to combat it.”
Biodiesel logo GAPKI
GAPKI is holding firm that any regulatory measure imposed by the EU on its palm oil imports must:
- not discriminate against Indonesia;
- not discriminate against palm oil;
- provide a level playing field for certification;
- preference legality rather than sustainability; and
- uphold Indonesian sovereignty.
- recognise ISPO in any due diligence regulation it is proposing
- not discriminate against Indonesia;
- not discriminate against palm oil;
- provide a level playing field for certification;
- preference legality rather than sustainability; and
- uphold Indonesian sovereignty.
- recognise ISPO in any due diligence regulation it is proposing
For the moment, Indonesia appears to have influenced how the EU looks at palm oil. Key questions remain on how far both parties are willing to go in order to hammer out a position that is mutually accepted.
Malaysia as the second largest producer of palm oil globally and a participant in the EU-ASEAN JWG has been reserved in making public statements on the issues. It may have less to say as Malaysia is of the opinion that its strict management of palm oil production under the Malaysian Sustainable Palm Oil (MSPO) is up to snuff on global standards for sustainable products.
The Indonesian Sustainable Palm Oil (ISPO) standards which are in the process of an up grade have been criticized by activists as being inadequate “to protect human rights or the environment, and needs to accommodate input from Indigenous and forest communities.”
GAPKI appears to have backed off slightly from its usual truculent position as it proposed the ISPO as the starting point for the sustainability of Indonesian palm oil rather than insisting the ISPO standards are strong enough to produce palm oil sustainably for the EU.
Legality a Challenge in the Indonesian Palm Oil Industry
The thing is that Indonesia has a large problem in the legality of its palm oil which needs to be addressed before any suggestions can be made on its sustainability.
A report by Bloomberg found that 19% of Indonesia’s palm oil plantations or 3.1 million hectares has been found by the government to be operating without a license. The legality of these Indonesian plantations will clearly need to be sorted out as part of the government’s drive to reshape its industry.
In a separate report, the state auditor found that about 81% of plantations broke various state regulations.
“Violations include operating in conservation and peatland areas as well as non-compliance with Indonesian Sustainable Palm Oil standards, said Luhut Pandjaitan, Coordinating Minister of Maritime Affairs, citing findings by state auditor BPK.”
GAPKI's position on the legality problem has been to offer up the Indonesian Sustainable Palm Oil (ISPO) scheme as a solution. In making its point on legality as a base point for sustainability, GAPKI has proposed that the EUFLEGT program be extended to palm oil which could be made within the Indonesian Sustainable Palm Oil (ISCPO) scheme. Considering the criticisms against the ISPO, the EU-ASEAN JWG on palm oil therefore represents a good opportunity for Indonesia and the EU to work on a standard that will be acceptable to the EU which had made an earlier call for its revamp.
In an earlier response to criticism by Indonesia of discrimination by the EU, the Delegation of the European Union to Indonesia issued a public statement in March of 2019 which stated:
“Our doors have always been open and will remain so for frank discussion and dialogue with the Indonesian government and other stakeholders on this issue. We also expect that the establishment of a joint working group between the EU and relevant ASEAN Member States to address issues relating to palm oil will serve as another avenue for discussions.”
Beyond the Joint Working Group which is now established, the EU Commission further stated that:
“5. No specific biofuel or feedstock is targeted. All vegetable oils are treated equally. Palm oil is not
identified as a bad biofuel per se.
11. The European Commission will reassess the data and if appropriate the methodology in 2021
and will carry out a revision of the Delegated regulation in 2023. At that moment, any efforts
undertaken by Indonesia (such as a revamped ISPO, the moratorium, the one map policy, or the
recently adopted national action plan) will be taken into account.
15. The EU is committed to implement the UN Sustainable Development Goals both in its internal
and external policies. This is joint endeavour for the EU, all EU Member States and Indonesia.”
Winning the arguments
In its argument for the United Nations Sustainable Development Goals, Indonesia has a point in that of the top exporters of palm oil to the EU, the country remains one of the poorest in terms of GDP per capita.
This alone should make the alarmist calls of Western groups like Chain Reaction Research and Mighty Earth a moot point for sustainable development in Indonesia in a G2G discussion. This is especially so as environmental groups have accused the EU of having too large a carbon footprint even if palm oil was removed from EU consumption.
GAPKI has for the moment, nailed the EU to its commitments to the UN SDGs and that no feedstock is discriminated against.
This opinion does not hold high hopes for a positive outcome for the EU-ASEAN Joint Working Group unless the European Union comes to the discussion table with a commitment to geopolitical stability and a clear understanding of the sustainable development needs of ASEAN countries.
Indonesia has the highest GDP in the ASEAN region with USD 1 trillion in 2017 and it is the only ASEAN member who is part of the G-20. This might be enough for GAPKI to win its arguments against the current position of the EU on palm oil. The sustainable development of Indonesia cannot be defined within the confines of palm oil but it can be influenced by the one crop that can best bring sustainable development to this sprawling tropical archipelago and its rich biodiversity.
Published January 2021 - CSPO Watch
Malaysia as the second largest producer of palm oil globally and a participant in the EU-ASEAN JWG has been reserved in making public statements on the issues. It may have less to say as Malaysia is of the opinion that its strict management of palm oil production under the Malaysian Sustainable Palm Oil (MSPO) is up to snuff on global standards for sustainable products.
The Indonesian Sustainable Palm Oil (ISPO) standards which are in the process of an up grade have been criticized by activists as being inadequate “to protect human rights or the environment, and needs to accommodate input from Indigenous and forest communities.”
GAPKI appears to have backed off slightly from its usual truculent position as it proposed the ISPO as the starting point for the sustainability of Indonesian palm oil rather than insisting the ISPO standards are strong enough to produce palm oil sustainably for the EU.
Legality a Challenge in the Indonesian Palm Oil Industry
The thing is that Indonesia has a large problem in the legality of its palm oil which needs to be addressed before any suggestions can be made on its sustainability.
A report by Bloomberg found that 19% of Indonesia’s palm oil plantations or 3.1 million hectares has been found by the government to be operating without a license. The legality of these Indonesian plantations will clearly need to be sorted out as part of the government’s drive to reshape its industry.
In a separate report, the state auditor found that about 81% of plantations broke various state regulations.
“Violations include operating in conservation and peatland areas as well as non-compliance with Indonesian Sustainable Palm Oil standards, said Luhut Pandjaitan, Coordinating Minister of Maritime Affairs, citing findings by state auditor BPK.”
GAPKI's position on the legality problem has been to offer up the Indonesian Sustainable Palm Oil (ISPO) scheme as a solution. In making its point on legality as a base point for sustainability, GAPKI has proposed that the EUFLEGT program be extended to palm oil which could be made within the Indonesian Sustainable Palm Oil (ISCPO) scheme. Considering the criticisms against the ISPO, the EU-ASEAN JWG on palm oil therefore represents a good opportunity for Indonesia and the EU to work on a standard that will be acceptable to the EU which had made an earlier call for its revamp.
In an earlier response to criticism by Indonesia of discrimination by the EU, the Delegation of the European Union to Indonesia issued a public statement in March of 2019 which stated:
“Our doors have always been open and will remain so for frank discussion and dialogue with the Indonesian government and other stakeholders on this issue. We also expect that the establishment of a joint working group between the EU and relevant ASEAN Member States to address issues relating to palm oil will serve as another avenue for discussions.”
Beyond the Joint Working Group which is now established, the EU Commission further stated that:
“5. No specific biofuel or feedstock is targeted. All vegetable oils are treated equally. Palm oil is not
identified as a bad biofuel per se.
11. The European Commission will reassess the data and if appropriate the methodology in 2021
and will carry out a revision of the Delegated regulation in 2023. At that moment, any efforts
undertaken by Indonesia (such as a revamped ISPO, the moratorium, the one map policy, or the
recently adopted national action plan) will be taken into account.
15. The EU is committed to implement the UN Sustainable Development Goals both in its internal
and external policies. This is joint endeavour for the EU, all EU Member States and Indonesia.”
Winning the arguments
In its argument for the United Nations Sustainable Development Goals, Indonesia has a point in that of the top exporters of palm oil to the EU, the country remains one of the poorest in terms of GDP per capita.
This alone should make the alarmist calls of Western groups like Chain Reaction Research and Mighty Earth a moot point for sustainable development in Indonesia in a G2G discussion. This is especially so as environmental groups have accused the EU of having too large a carbon footprint even if palm oil was removed from EU consumption.
GAPKI has for the moment, nailed the EU to its commitments to the UN SDGs and that no feedstock is discriminated against.
This opinion does not hold high hopes for a positive outcome for the EU-ASEAN Joint Working Group unless the European Union comes to the discussion table with a commitment to geopolitical stability and a clear understanding of the sustainable development needs of ASEAN countries.
Indonesia has the highest GDP in the ASEAN region with USD 1 trillion in 2017 and it is the only ASEAN member who is part of the G-20. This might be enough for GAPKI to win its arguments against the current position of the EU on palm oil. The sustainable development of Indonesia cannot be defined within the confines of palm oil but it can be influenced by the one crop that can best bring sustainable development to this sprawling tropical archipelago and its rich biodiversity.
Published January 2021 - CSPO Watch