INDONESIAN GOVERNMENT STRATEGIES ON OBTAINING CRUDE PALM OIL (CPO) MARKET TO EUROPEAN UNION COUNTRIES OVER THE EU PARLIAMENT RESOLUTION ON PALM OIL AND DEFORESTATION OF RAINFOREST (2015-2017)

Abstract

Indonesia is the largest producer of palm oil in the world. With Malaysia, palm oil production could account for about eighty percent of global production. Meanwhile, Europe is the country with the third largest CPO export destination for Indonesia after India and China. But with the declining trend of Indonesia's palm oil trade with the European Union from 2015, supported with the declining trend in CPO consumption in the European Union, the Indonesian government started to concerns with the issue. Moreover since the EU proposed a European Union resolution initiative on palm oil and deforestation of rainforest, which finally passed with the major votes from EU members of Parliament in April 2017. The key point on EU resolution reveals that EU will ban palm oil use for biofuels production by 2020. However, there are still many statements in the EU Resolution that considered by the Government of Indonesia to be discriminatory and unfair. This issue due to there are arguments in Resolution that might becomes unnecessary trade barrier or challenges for Indonesian CPO industries to keep the volume export in EU countries. Apparently, to support this research to reveals how important CPO export for Indonesia, the study looks at the predictions of total loss of Indonesian exports on palm oil by 2020 and for longterm risk that might affect the global trend of palm oil consumption. Therefore, the purpose of this research is to analyze the Indonesian government’s diplomatic efforts to respond and negotiate with EU regarding the issue. It is also considered important to prevent the global downturn on palm oil products. To analyze the diplomacy effort, the researcher will use qualitative methods presented through data collection from sources such as books, journals, press releases and official reports from institutions in this case the European Union. To support the research, the researcher also uses primary data through interview with one of the representative of the Ministry of Foreign Affairs of the Republic of Indonesia for diplomatic actions conducted by Indonesian government