The French palm oil tax, as passed by the National Assembly in March, is a discriminatory proposal, that would harm the relations between France, and Malaysia.
Palm oil is a major commodity export for Malaysia, and for Indonesia, whether in the form of crude palm oil itself (CPO), oleochemicals or other products. The tax proposed by France is a serious and unfriendly act that could have negative consequences for jobs and rural development in Indonesia and Malaysia, and possibly other palm oil producing countries around the world.
In which case, the question needs to be asked: if Malaysia were to respond to the tax, through trade policy instruments, what would be the options at their disposal?
There are a number of options that would be available, if palm oil producing countries chose to respond.
