KUALA LUMPUR – A brief bilateral meeting between Malaysian and Indonesian leaders witnessed a strong pledge to aggressively combat discrimination against the wonder crop by Europe, Australia, and Oceania.
The partnership between the two giants, who contribute 87% of the global palm oil supply, is crucial especially now, as both nations have sought consultations under the World Trade Organisation’s dispute settlement mechanism against the European Union for restricting palm oil-based biofuels.
Indonesia had filed its request for consultations on December 16, 2019, while Malaysia did so on January 19 this year.
Despite the separate filings, both will join forces to fight the palm oil bias.
“This anti-palm oil campaign is baseless, does not reflect the sustainability of the palm oil industry in the world, and contradicts the commitment of EU and WTO on the free-trade practice,” Prime Minister Tan Sri Muhyiddin Yassin said after his meeting with Indonesian President Joko Widodo in Jakarta on Friday.
This marks Muhyiddin’s first official overseas visit since assuming office last year.
During a press conference, Muhyiddin said Malaysia would continue to cooperate with Indonesia on the issue of palm oil discrimination, especially on strengthening the Council of Palm Oil Producing Countries (CPOPC) to protect the palm oil industry and save millions of smallholders whose livelihoods depend solely on palm oil.
The Malaysian prime minister arrived in Jakarta late Thursday afternoon at the invitation of Jokowi and returned on Friday.
Palm oil stakeholders welcomed the move by the two governments, saying that the support and coordination by both countries via the CPOPC is essential to protect the industry from all sort of discrimination.
The CPOPC was established jointly by Malaysia and Indonesia on November 21, 2015 to champion issues related to the palm oil industry.
However, some industry players opined that both leaders could have deliberated more on the labour issue, especially for the plantation sector as it has been a major concern for Malaysia.
The meeting between Muhyiddin and Jokowi discussed matters on the recruitment of Indonesian workers and domestic helpers in general, and also touched on initiatives to safeguard the welfare and well-being of Malaysian and Indonesian fishermen in areas with maritime issues.
Unlike Indonesia, which has a large population, Malaysia has over the past few years experienced a shortage of labour it fears will not realise its potential production of up to 25%.
The world’s second-largest palm oil producer relies on workers from countries such as Indonesia and Bangladesh as they account for 84% of its plantation workforce, including that of plantation giants like Sime Darby Plantation Bhd (SDP), Kuala Lumpur Kepong Bhd, IOI Corp Bhd, and United Plantations Bhd.
Despite efforts to woo locals, response remains lukewarm.
Sime Darby Plantation for example had even narrowed its search for palm oil workers to prison inmates via a collaboration with the Malaysian Prisons Department to join the world’s largest plantation company.
In a statement on Saturday, chief operations services officer Adi Wira Abd Razak said SDP is calling locals to join its upstream and downstream operations by quashing the misconception about the sector being in the “dangerous, dirty, and difficult” (3-D) category.
“It is unfortunate that over the years, we have seen a steady decline in the interest of Malaysians, especially the younger generation, in taking up the various job opportunities available in this industry.
“Perhaps it is due to the misconception that this is a 3-D industry. The fact of the matter is that this is no longer the case today,” he said.
Adi Wira noted that SDP has been actively recruiting locals in the past year, hoping to see the number of local hires increasing as the future prospects of this industry are bright.
“Palm oil is such an important and valuable ingredient to the world. More than 50% of all the products you see on supermarket shelves around the world contain palm oil and it is not easily replaced by alternatives,” he stressed.
SDP and the other palm oil producers have been forced to embark on more creative recruitment moves to hire locals. Shares of SDP are trading at RM4.93 at Monday's opening, up by 0.41%.
Meanwhile, plantation companies have gone the extra mile to post online job advertisements highlighting benefits such as free housing, utilities, and others in a bid to lure workers to the industry.
The industry is poised for a rosier outlook this year with plantation analysts forecasting higher crude palm oil prices of between RM3,000 and RM3,500 per tonne in February, in view of the projected low inventory in the country, which will take time to rebuild. – Bernama, February 8, 2021
