Jakarta has conveyed to Lithuania that Indonesia's palm oil is sustainable, and its main product meets national sustainability standards.
Foreign Minister Retno Marsudi held bilateral talks with his Lithuanian counterpart Gabrielus Landsbergis at his office in Jakarta on Monday. Economic cooperation is the main agenda.
During the trade talks, Retno discussed the export of sustainably produced Indonesian palm oil. Indonesia also reports that hundreds of its plantations have received ISPO (Indonesian Sustainable Palm Oil) certification. As the name suggests, this is the National Palm Oil Sustainability Certification System.
"I am happy that Indonesian palm oil is one of the most important exports for Lithuania," Retno said in a press conference shortly after meeting Landsbergis.
"With nearly 800 ISPO-certified farms in Indonesia, I am confident that Indonesia will provide more sustainable palm oil to Lithuania and the wider European market," Retno said.
Jakarta wants Vilnius to be more open to Indonesian rubber and wood products for more trade. Retno said that the current trade volume between Indonesia and Lithuania increased by almost 43% in the first half of this year compared to last year, "it does not reflect the true potential."
He added, "In order to strengthen our bilateral trade and ensure balanced trade, I have asked Minister Landsbergis to support me in facilitating the entry of more Indonesian products into the Lithuanian market, including rubber, paper and wood products."
At the press conference, Landsbergis did not talk about Indonesian palm oil, although the diplomat said the meeting with Retno focused on economic relations.
"We have a great opportunity to discuss increasing our economic ties in areas such as IT [information technology], LNG (liquefied natural gas), renewable energy, agriculture and space technology," Landsbergis told reporters.
According to government data, trade between Indonesia and Lithuania will increase from $43.4 million in 2021 to $53.7 million next year. However, bilateral trade does not provide benefits to Indonesia because Jakarta has experienced a deficit in recent years. For example, Indonesia's deficit with Lithuania will be $30.3 million in 2022.
The Economic Complexity (OEC) trade information platform reported that Indonesia's top exports to Lithuania in 2021 were two-wheeler spare parts (20.6%), rubber clothing (11.7%) and margarine (7%). Palm oil accounted for 0.89 percent of Indonesia's total exports to Lithuania this year.
Lithuania is an EU member critical of Indonesian palm oil.
Indonesia has opposed the European Union's anti-deforestation regulations, better known as EUDR, which require operators to ensure that their products do not come from deforested land. Operators must provide accurate geographic location coordinates in their due diligence statements before their products are allowed to enter the European market.
Palm oil, rubber and timber are some of the products covered by the EUDR. These guidelines also apply to products made from these raw materials.
Jakarta insists that the EUDR create an ISPO-certified palm oil pathway. According to the Indonesian Palm Oil Entrepreneurs Association, ISPO covers areas such as the absence of forced labor, fair treatment in supply contracts, and the prevention of peat swamp plantations and primary deforestation.
Indonesia and the EU are also negotiating a trade deal. This trade agreement, known as the Indonesia-EU Comprehensive Economic Partnership Agreement, will begin its 16th round of negotiations later this year.
Read more: Indonesia may sue EU over protectionist green policies: The Economist
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