Assessing the impact of limiting Indonesian palm oil exports to the European Union

Abstract

Indonesian exports reached US$ 168.8 billion in 2017, an increase of 16.8% compared to the previous year (UN Comtrade 2018). One of the largest contributors to these exports is palm oil, amounting to 13.6% in 2017. Indonesian palm oil exports in 2017 reached US$ 22.97 billion, an increase of 26% compared to the value in 2016 (UN Comtrade 2018). In 2017, Indonesia exported approximately 29 million tons of palm oil, with the largest destination countries including India, with a market share of 25.37%; followed by the European Union, with 14.35%; and China, with 12.39% (UN Comtrade 2018). Different from India and China, which directly consumed its palm oil, European market besides consumed directly it also serve as a trade hub for other countries in the region (Rifin 2013). For a long time, countries of the European Union, particularly the Netherlands, have been the major market destination for Indonesian palm oil as well as being countries that connect Indonesia and other European countries. However, there have been many instances in the last several years where oil imports, mainly from Indonesia, have been hindered from entering European countries. Several issues, including health, environment, and animal protection, have been considered to hamper the entrance of Indonesian palm oil to Europe. This is confirmed by the Report on Palm Oil and Deforestation on Rainforests, which stated that palm oil is a very large problem related to the issue of corruption, child labor, violation of human rights, omission of the rights of indigenous people, and a trigger to deforestation and habitat

Firm Performance Factors and Efficiency of Indonesian Palm Oil Companies

“…The palm oil industry is one of Indonesia's agricultural industries, which is experiencing rapid development in the global market (Pahan et al 2011;Maesaroh et al 2018;Purnomo et al 2020;Rifin 2020). Oil palm contributes 17% of total income from the agricultural sector so that this commodity becomes one of the main agricultural products in Indonesia (Acosta & Curt 2019).…”

Export intensity and competitiveness of Indonesia's crude palm oil to main destination countries

“…The EI approach will be even more integrative, and in the future, it will be able to link the performance of business actors individually and country level collectively. Rifin et al (2020) researched Indonesia's palm oil trade and its international market challenges. This https://doi.org/10.17221/371/2020-AGRICECON study aims to assess the suspension of Indonesia's palm exports to the European Union in terms of Indonesia's economic conditions.…”

Dampak Ekspansi Kelapa Sawit terhadap Kinerja Perkebunan Kelapa di Indonesia

“…Pada sisi yang lain, penelitian Edward (2015) dengan menggunakan data sekunder menunjukkan bahwa ekspansi kelapa sawit berdampak positif bagi pengurangan kemiskinan dan pertumbuhan ekonomi. Rifin et al (2020) juga menunjukkan bahwa peran ekonomi komoditas sawit relatif tidak terpengaruh oleh berbagai hambatan perdagangan yang diterimanya.…”