EU palm oil ban may hit UK’s RM27 bil defence deal with M’sia

12.02.2018

France, which wants to sell its own Rafale fighter jets, tries to outflank Britain by promising to oppose EU ban.

palm-oil-european-union-1PETALING JAYA: The European Union’s (EU) impending ban on palm oil threatens to put an end to any possibility of Malaysia purchasing £5 billion (RM27.36 billion) worth of defence supplies from the UK.

The London-based The Sun newspaper reported today the proposed deals were being jeopardised by the prohibition against imports of palm oil from Malaysia.

It said France, which wants to sell its Rafale fighter aircraft to Kuala Lumpur, was trying to outflank Britain by promising to oppose the EU ban.

It said the two EU countries were both bidding to sell fighter jets and other materials to Malaysia. Each country would ensure some 20,000 domestic jobs by clinching the orders.

The report also said Plantation Industries and Commodities Minister Mah Siew Keong was scheduled to travel to UK this week to demand its support against the EU’s proposed ban.

It said a rift had emerged in the British cabinet over Mah’s visit, with UK Environment Secretary Michael Gove supporting the ban and Defence Secretary Gavin Williamson vowing to put jobs first by gaining the Malaysian contracts.

French President Emmanuel Jean-Michel Frédéric Macron was meanwhile working to persuade Malaysia to buy the Rafale jets instead of British planes, the report said.

In Britain, BAE Systems had sales of its Eurofighter Typhoon and weapons worth £4 billion (RM21.9 billion) at stake in the deal, it said.

Airbus UK was also bidding to supply communication satellite equipment worth up to £700 million (RM3.8 billion) while Italian company Leonardo could be affected as it wanted to sell its AW150 helicopters to Malaysia in a £300 million (RM1.64 billion) deal, the report said.

The EU Environment Committee voted to ban the use of palm oil in biodiesel last October.

This was endorsed by the EU’s Industrial, Research and Energy Committee a month later. The European Parliament is expected to vote on the matter soon.

Malaysian leaders have said the country would retaliate by banning imports of European products.

Much of the palm oil sold to Europe is turned into biofuel.


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