MEDIA STATEMENT

EUROPEAN UNION PARLIAMENT TURNS BACK ON ASEAN
PARTNERS WITH APPROVAL OF EUROPEAN UNION
DEFORESTATION REGULATION (EUDR)

  1. On 19 April 2023, the EU Parliament voted to approve the negotiated deal on the EU’s Deforestation Regulation (EUDR).
  2. The Regulation is a deliberate effort to increase costs and barriers for Malaysia’s palm oil sector, including more than 450,000 smallholders. This ultimately would increase poverty, reduce household incomes and harm our rural communities – outcomes that stand in stark contrast to the EU’s commitments outlined in the UN Sustainable Development Goals.
  3. The EUDR is unjust and serves primarily to protect a domestic oilseeds market that is inefficient and cannot compete with Malaysia’s efficient and productive palm oil exports.
  4. The Government of Malaysia restates its core position:
    • A Small Farmer exemption is needed: The EU should commit to a genuine exemption for smallholders in the EUDR. This would prevent large European importers from cutting smallholders out of supply chains – an entirely avoidable consequence should small farmers be given proper consideration.
    • No ‘High Risk’ classification: The EU should commit to not classifying Malaysia as a ‘high risk’ country nor pursuing a jurisdictional approach. The designation of Malaysia as high risk is unjustified. Malaysia has made, and kept, world-leading commitments to forest conservation and sustainable agriculture that have been recognised by leading global institutions such as the UN FAO and the World Bank.
    • Recognize Malaysian Standards: The EU should acknowledge the benefits of the Malaysian Sustainable Palm Oil (MSPO) standard – a mandatory sustainability certification – and recognize it as a path to compliance with the EUDR.
  5. Malaysia remains open to engagement with the European Union to address these concerns. The EU must now commit to genuine involvement for both governments and industries from producing countries, including as part of the ongoing Deforestation Platform.
  6. Malaysian palm oil is sustainable and one of the most-certified vegetable oils in the world today. The MSPO standard already guarantees Malaysia’s commitment to comprehensive sustainability standards and has helped reduce deforestation from palm oil to effectively zero. Malaysia will continue to provide sustainable and deforestation-free palm oil to our global customers.
  7. It is disappointing to witness the European Union withdrawing from the global marketplace and erecting protectionist barriers. This move is woefully misguided, especially as the ASEAN and CPTPP groupings are gaining in influence and attracting new partners from around the world.
  8. The Malaysian Government, working alongside our partners in Indonesia, is considering an appropriate response to this Regulation, given the importance of the palm oil sector and the clear intent to impose an unjustified trade barrier.
  9. The Malaysian Government urges the EU to address the concerns of Malaysia and the entire palm oil sector effectively and expeditiously.

YAB DATO’ SRI HAJI FADILLAH BIN HAJI YUSOF
DEPUTY PRIME MINISTER
AND MINISTER OF PLANTATION AND COMMODITIES
20 APRIL 2023