Malaysia seeks alliance with Indonesia to respond to EU palm oil restrictions

Leaders of Indonesia and Malaysia this week chafed at EU efforts to reduce deforestation that could affect palm oil imports. By Thursday, officials in Malaysia said they were considering a complete halt on palm oil exports to the EU, Bloomberg reports.

The EU’s deforestation law, passed in December, bans the sale of palm oil and other deforestation-intensive products, unless importers can provide evidence that the products are not an outgrowth of deforestation. Some environmental activists have blamed the palm oil industry for the destruction of rainforests in Southeast Asia, despite Indonesia’s and Malaysia’s efforts to enforce sustainability standards, Reuters reports.

Indonesia and Malaysia are the world’s two largest producers of palm oil, together representing upwards of three quarters of global production. Both countries have raised cases about the deforestation law’s impact on palm oil with the WTO. The EU is the world’s third largest palm oil importer.