Indonesia vs. European Union: Palm Oil and Biofuels Dispute at WTO Panels

The article explores the escalating trade dispute between Indonesia and the European Union (EU) over the latter's classification of palm oil as a high-risk commodity for deforestation under the Renewable Energy Directive II (RED II) and Delegated Regulation. This move is seen as a trade barrier that discriminates against palm oil, favoring other European crops. Indonesia contests these policies, arguing they undermine its economic interests and ignore sound scientific evidence. The dispute, highlighted at the World Trade Organization (WTO), underscores the broader conflict between environmental sustainability and trade liberalization, with implications for the global biofuels market and the relationship between economic development and environmental policies.

The ongoing trade dispute between Indonesia and the European Union (EU) over palm oil and biofuels is one of the most significant cases in international trade law, with far-reaching implications for the global biofuels market and environmental sustainability. The conflict revolves around the EU’s Renewable Energy Directive II (RED II) and the Delegated Regulation that categorizes palm oil as a high-risk commodity for deforestation and unsustainable land use. This classification, according to Indonesia, constitutes a discriminatory trade barrier that undermines its economic interests and the livelihoods of millions of palm oil farmers. At the core of this dispute are questions of sustainability, environmental protection, and the right balance between trade liberalization and the global environmental agenda. The case, brought before the World Trade Organization (WTO), has highlighted the tension between economic development in producer countries like Indonesia and the environmental ...