Indonesia urges EU to remove biodiesel import curbs after WTO ruling
- Duties deemed non-compliant with WTO rules, Indonesia says
- Indonesia-EU disputes persist even as trade pact progresses
Indonesia urged the European Union on Monday to scrap countervailing duties on imports of biodiesel immediately, after the World Trade Organization backed several of Jakarta's main claims in a complaint to the trade body.
The world's biggest palm oil exporter had contended in its 2023 complaint that the duties levied by the European Union, the third-largest destination for its palm oil products, broke the trade body's rules.
"We urge the EU to immediately revoke these countervailing import duties that are not WTO-compliant," Trade Minister Budi Santoso said in a statement.
The case joins a string of disputes over biodiesel tariffs and palm oil's link to deforestation, as the EU and Indonesia edge nearer to signing a free trade deal after a political agreement struck in July.
The EU has imposed the duties, ranging from 8% to 18%, since 2019, saying the Southeast Asian nation's biodiesel producers benefit from grants, tax benefits and access to raw materials below market prices.
The trade ministry said the WTO panel held that Indonesia's export duty and export levy on palm oil could not be categorized as a subsidy.
The Indonesia Palm Oil Association, GAPKI, said it welcomed the WTO ruling and called on the European Commission to make sure future measures, particularly EU deforestation regulation, did not discriminate against Indonesian palm oil.
The EU representative in Jakarta did not immediately respond to a request for comment.
Indonesia's exports of palm oil-based biodiesel stood at 27,000 kiloliters (kl) in 2024. They had plunged to 36,000 kl in 2020 from 1.32 million kl in 2019.
An official from the Indonesia Biofuel Producers Association said they doubted the EU would comply with the request, going by past experience.
"We, as an industry, must remain vigilant and ready for any movement by the EU after this ruling," Catra de Thouars said. He said Jakarta was still in dispute with Brussels over the EU's anti-deforestation rules.
The countervailing duties came a year after the European Court of Justice ordered the EU to do away with anti-dumping duties on imports of Indonesian biodiesel.
Jakarta expects the upcoming free trade pact to open the way for greater market access for palm oil, among other products.
Comments