The memorandum of understanding (MoU) signed on April 25 this year, on China's import of 1.9 million tonnes of palm oil from Malaysia, is not an extension of the old one inked on Nov 23, 2015
The Ministry of Primary Industries said the MoU was signed by the Minister of Plantation Industries and Commodities in 2015.
The cooperation was to the country's palm oil trade to China. There was no commitment or guarantee that China would increase its import of Malaysian palm oil.
"Under the Pakatan Harapan government, the ministers are tasked with negotiating additional imports of Malaysian palm oil by China and at the same time, explore opportunities under the Belt and Road Forum for International Cooperation (BRF) initiative," in a statement today.
Former prime minister Najib Abdul Razak claimed in his Facebook posting yesterday the MoU, which was signed recently, was an extension of the talks and original agreement between China and the Barisan Nasional government during his premiership in 2015.
On April 25, China has increased the volume of palm oil imports and the agreement was finalized in the MoU between the Malaysian Palm Oil Council and China Chamber of Commerce of Foodstuffs, Native Produce and Animal By-Products.
"The main objective of the MoU is to enhance good relations in agro-commodity trade, especially in the palm oil sector between the two countries.
"It will also increase the export of palm oil to China by an aggregate amount of 1.9 million tonnes worth RM4.56 billion for five years (2019-2023)," the ministry said.
It said that the palm oil and palm-based products between the Chinese government-linked companies and the Malaysian palm oil exporters.
"This MoU does not restrict or limit Malaysia's palm oil exports to China. It is in addition to the existing palm oil exports to China by Malaysian exporters," the ministry said.
The MoU also opens new opportunities for Malaysia to invest in biofuel plants estimated at RM2.06 billion (US $ 500 million) and unsaturated fats at RM206 million (US $ 50 million).