European Union is at a Great Loss if They Boycott Palm Oil

If the EU limits or boycotts palm oil, the EU loses at least 8 billion Euros per year and encourages deforestation of about 14 million hectares in South America

EU countries in recent years have intensively attacked palm oil in various ways. Some countries such as France have openly planned to boycott the palm oil by charging unreasonable import tariffs. Many countries also secretly support the movement of palm oil free labeling. In fact, many are donating anti-oil palm organizations operating in Indonesia. It seems that the anti-Indonesian NGOs have succeeded in deceiving the public and the EU government.

However, not everyone in the EU is like that. There are still many realistic people, especially the intellectuals and statesmen. This rational and realistic group has data, or has seen comprehensively how the reality of oil palm plantations is. They even understand the benefits of palm oil import for the EU and the consequences if the EU limits, let alone, boycotts palm oil for the EU itself.

The EU imports more than 6 million tons of palm oil annually. According to a European Economic (2014) study, palm oil coming into the EU is about 60 percent used for food, cosmetic / pharmaceutical ingredients, oleochemical industry; and 40 percent for energy (biodiesel and power generation).

From the economic point of view, EU palm oil imports annually create the “economy cakes” for EU governments and their communities. The “economic cake” in the form of community income (GDP) is about 5.7 billion euro, the EU government receives tax income of about 2.6 billion euro and employs the EU population of 117 thousand people. The five largest EU countries enjoy the “economic cake” of imported palm oil are Italy, Spain, Germany, Holland and France.

Well, if the EU government limits or even boycotts the import of palm oil to the EU, then the “economic cake” created by palm oil will be reduced or even lost. EU community revenues involved in the palm oil economy in the EU will be lost, government’s revenue is reduced, unemployment will increase and there will be energy shortage in the EU.

The problem does not stop there. If 6 million tons of CPO does not enter the EU, then the production of rapeseed oil or sunflower seed oil should be increased to compensate the shortage. The area of ​​rapeseed and sunflower plantations in the EU should be expanded for about 14 million hectares. Then other agricultural areas should be converted into vegetable oil plantations. If this is the case, then the EU community will be faced with food shortages or inflation, or the expansion of new agricultural land; that translates into massive deforestation in the EU.

Perhaps the EU government thinks like an EU football management that imports many footballers from South America. The replacement of CPO imports is covered with larger imports of soybean oil from Brazil, Argentina, and other countries. Of course it’s fine. But with the increased imports of soybeans from South America will boost up deforestation of at least 14 million hectares of land for additional soybean plantation expansion.

EU society doesn’t seem to have so many choices to maintain its prosperity. Unfortunately, the most efficient supply of vegetable oil comes from palm oil. The paradigm of the EU community and its government may need to change to see palm oil in a different perspective. The people and government of the EU need a new way of looking at palm oil as oil palm plantation is God’s gift to EU welfare through Indonesia.

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