Norway’s recent plans to ban biofuels containing palm oil from 2020 will provide a major hurdle for trade talks between the European Free Trade Association (EFTA) and Malaysia, a government minister said on 28 December.
A Norwegian parliamentary decision made on 3 December and set to come into effect in 2020 called for the government “to formulate a comprehensive proposal for policies and taxes in the biofuels policy in order to exclude biofuels with high deforestation risk”.
“The stand taken by Norway against palm oil will adversely affect bilateral trade relations between Malaysia and the European Free Trade Association,” Malaysia’s Primary Industries Minister Teresa Kok said in a statement on 28 December. “We view this as unfair and unjust, going against free and fair trade, and is certainly not something we will take lightly,” said Kok.
Malaysia’s last round of trade negotiations with EFTA was in May 2017, Reuters said.
Earlier in December, Kok had spoken out against the French Parliament for excluding palm oil as an approved biodiesel feedstock, suggesting the move went against free trade and threatened the livelihood of Malaysian farmers.
Malaysia and Indonesia exported around 90% of the world’s palm oil and had criticised the EU in early 2018 for backing a decision to ban palm oil in biofuels from 2021, Reuters wrote.
EU negotiators later agreed that palm oil usage in transport fuels would be capped at 2019 levels until 2023 and would be reduced to zero by 2030.
