TPPA will boost country’s palm oil export — Uggah

KUCHING: The Trans-Pacific Partnership Agreement (TPPA) will boost the country’s export of palm oil and make it more competitive in the global market, Minister of Plantation Industries and Commodities Datuk Amar Douglas Uggah Embas said.

In addition, he said levies will be lifted under the TPP trade deal and taxes will not be imposed on participating countries for their imports and exports.

With tax on crude palm oil to be rated at zero per cent, Malaysia would be able to provide lower rates in import tariff to other participating countries. This would put the country on a more level playing field especially against similar agriculture commodities, he pointed out.

“We are positive on the effect of TPPA on the oil palm industry. Under this trade agreement, there will no longer be any import/export taxes enforced on member countries and this will make us more competitive when compared to other producing countries that are not TPPA members,” Uggah told reporters when met after officiating at the ‘Reach and Remind Friends of the Industry Seminar 2016’ at Pullman Hotel here yesterday.

Attending the event which was followed by a dialogue with palm oil industry players were the ministry’s deputy secretary-general (commodity) Datuk M Nagarajan, Malaysian Palm Oil Council (MPOC) chief executive officer Tan Sri Datuk Dr Yusof Basiron and Malaysian Palm Oil Board (MPOB) director-general Datuk Dr Choo Yuen May.

Citing the Free Trade Agreement with Turkey, where lots of taxes were lifted, Uggah disclosed that exports of commodities to the country had improved by 200 per cent.

“The implementation of the TPPA will only benefit the oil palm oil industry,” he continued.

The signing of the TPPA is expected to take place on Feb 4 in New Zealand. The TPP aims to create the world’s biggest free-trade area, bringing together countries including Australia, Brunei, Canada, Chile, Japan, Mexico, Peru, Singapore, Vietnam and the United States – accounting for some 40 per cent of the global economy.

On another note, Uggah said revenue from the palm oil industry last year was about RM60 billion, a slight reduction from the previous year. In terms of volume, the industry recorded an increase in export but lower price when compared to 2014 which affected revenue.

When delivering his keynote address earlier, he cautioned that the projected tepid global economic scenario this year would pose a number of challenges including sustaining demand of palm oil in major importing countries. Slower economic growth in major importing countries and higher output of competing vegetable oils necessitate a review of current marketing strategies to ensure continued market access for Malaysian palm oil, he pointed out.

He advised exploring new opportunities for palm oil, suggesting the need for synergy in the development of palm-based bio fuels that are cost effective.

He pointed out that palm-based bio fuel is both environmentally friendly and a source of sustainable form of energy that will complement efforts of major developed countries to reduce carbon emissions.

“We also need to work with research institutions in major importing counties to promote palm oil from the nutritional perspectives backed with scientific evidence,” he continued.

To further promote domestic consumption and value-add palm oil products, he said the ministry will continue to intensify research and commercialisation of new palm based products which in the long run will generate new demands and expand market opportunities.

In 2010, Malaysia accounted for 36.7 per cent of the global palm oil production and 45.6 per cent of global exports. However, over the years its production declined and in 2015, it accounted for 31.7 per cent of the global palm oil production and 36.4 per cent of global exports. - Borneo Post

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