UK government offers positive verdict on Malaysian deforestation standards for palm oil

Industry observers have welcomed a UK government verdict that has offered a report confirming that Malaysia is operating mandatory deforestation-free standards (MSPO) in its palm oil operations, which are used for sectors including the confectionery market, writes Neill Barston.

Significantly, Britain’s Trade and Agriculture Commission (TAC) –also recommends to the UK Government that MSPO, and the Malaysian Palm Oil Board (Licensing) Regulations 2005, should be accepted as proven compliance tools for the UK’s Due Diligence regulations, established in the UK Environment Act.

As Confectionery Production has previously covered, wider industry concerns have been raised by environmental groups surrounding the use of palm oil, which has led to widespread issues of deforestation in some global areas. However, the sector has responded in recent years with a greater emphasis on sustainable harvesting methods.

The TAC provided its latest assessment to the UK Government following the UK’s successful negotiations to join the Comprehensive and Progressive Agreement for a Trans-Pacific Partnership (CPTPP).

This includes 11 countries that are members, making it the world’s largest free-trade deal – and so the UK was ready to make concessions to CPTPP nations, including Malaysia. Malaysian palm oil exports to the UK will henceforth be zero-tariff, as part of the agreement. The TAC analysis examines this change, specifically, and is supportive of the proposed zero-tariff for future Malaysian palm oil exports to the British market.

The TAC report foresees benefits for Malaysian exporters and UK consumers, as Malaysia becomes a larger supplier of palm oil to the UK market, following the CPTPP trade agreement. The TAC experts write: “we do expect to see some UK imports move … to Malaysian suppliers and some refined palm oil imports to move … to Malaysian suppliers”.

Furthermore, the UK TAC was reportedly asked to analyse the situation in part because of the opposition to the use of palm oil from environmental groups.Greenpeace and other traditionally anti-trade NGOs opposed the cuts in palm oil tariffs, claiming without evidence that deforestation could increase.

However, as noted by My Palm Oil Policy, an industry-wide online hub, the UK’s Business & Trade Secretary, Rt Hon Kemi Badenoch MP, is reported to have rejected such opposition, explaining to Sky News that “palm oil is a great product, it’s in so many of the things we use” and that such give-and-take is a normal part of trade negotiations.

The TAC’s trade and sustainability experts have examined the claims from NGOs as well, and dismissed them. Listening to expert analysis – rather than partisan campaigns – is an essential element to good governance. The TAC’s vast expertise includes Prof. Lorand Bartels, Professor of International Law at the University of Cambridge; Dr Andrew Swift, one of the U.K.’s leading experts on food and medicine testing; and Shanker Singham, a former advisor to both U.S. and U.K. governments on international trade law.

Palm oil is in fact, one of the most-certified and most-regulated commodities anywhere in the world: this reality is outlined in another London-based assessment published in recent weeks. The House of Commons’ Environmental Audit Committee (EAC) examined issues related to global deforestation, and found Malaysian palm oil to be a leader in sustainable practices.

The EAC Report was authored by Members of Parliament from several different UK political parties, and concluded that “there is an opportunity to learn from the experience of palm oil” because sustainability commitments “do not extend to other commodities”.

Significantly, the centrepiece of Malaysia’s commitment to palm oil sustainability is the Malaysian Sustainable Palm Oil (MSPO) standard, which the TAC accept allows for compliance with UK environmental regulations, such as the Environment Act. MSPO now deserves the formal recognition from government that it has already received in the marketplace – as the pre-eminent mandatory palm oil standard. As the clear ‘legality standard’ for Malaysian palm oil it is a ready-made compliance tool, and deserves to be formally recognised by the U.K. government.

The TAC report represents a responsible and fact-based approach to assessing how palm oil should be regulated by importing countries, and how Western nations can offer genuine support and partnership on sustainable production – rather than political grandstanding. This matters because the facts about Malaysian palm oil and deforestation are clear, and widely available. The World Resources Institute (WRI), Global Forest Watch (GFW), and United Nations FAO all state that the deforestation rate in Malaysia is zero; Malaysia is a “success story”; and “palm oil is no longer a driver of deforestation”.

It is a welcome development that the UK Government has listened to experts, and accepted the reality. Malaysian palm oil is the gold standard for sustainable production, and now it deserves to be recognised formally.

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