Egyptian-Malaysian free trade agreement in progress
Abdul Ghani said this in his reply to Ahram Online’s question on the extent of the cooperation between Malaysia and Egypt, during a press conference held on the sidelines of the two-day Malaysian Palm Oil Forum (MPOF KL 2024) kicked off in the Malaysian capital Kuala Lumpur on Tuesday.
This forum was launched under the theme “Navigating Trading Challenges with Sustainable Solutions,” with the participation of a group of Egyptian companies.
Egypt is a main importer of Malaysian palm oil; moreover, the Malaysian Palm Oil Council (MPOC) has a trade office in Cairo among other seven global offices, including three in the Middle East region along with ones in Saudi Arabia and Turkey.
Egypt is already engaged in several multilateral trade agreements, including the Greater Arab Free Trade Agreement (GAFTA), the African Continental Free Trade Area (AfCFTA) Agreement, the Agadir Free Trade Agreement, and the Common Market for Eastern and Southern Africa (COMESA), among others.
A platform of connection
The forum is hosted by the MPOC, offering a rich lineup of events including a conference, panel discussions, an exhibition, and a BizMatch session aimed at fostering business connections.
The two-day event also aims at facilitating engagement among stakeholders from the Malaysian palm oil industry and international buyers, serving as a platform for discussing the latest advancements in the oils and fats sector, exploring market trends, and addressing environmental, social, and governance (ESG) issues.
It also offers extensive trade and networking opportunities that connect over 70 key international buyers from various regions, including the Middle East region, particularly from Egypt.
It is worth noting that the MPOF was held in May in Egypt, as Egypt is a key exporter of oils and fats and a key palm oil exporter from Indonesia and Malaysia in particular.
Affordable alternative
Palm oil was initially introduced in Egypt as an affordable alternative to other animal fats.
Over the past two decades, the import and consumption of palm oil have steadily increased, as it is more cost-efficient compared to other vegetable oils, like soybean and sunflower oil.
It is widely used in food production, cosmetics, and industrial applications in the Egyptian market.
“We continue to be key suppliers for the Northern African countries in terms of the palm oil. The African market has lots of potential, such as the growing population and the high level of consumption, which raise the appetite of investors and maintain our focus on it as well. For Egypt, it is a big market for us,” Abdul Ghani said.
During the speech, the minister said that this year’s conference theme is indeed timely and relevant, as the palm oil industry sector faces numerous challenges, from ever-changing market dynamics and evolving trade policies to increasing scrutiny on sustainability practices and environmental impact.
“These are not just domestic challenges. They are global in nature and affect every player in the oils and fats industry,” added the minister.
Malaysia comes second after Indonesia when it comes to palm oil production. In 2023, crude palm oil (CPO) production increased by 0.5 percent to reach 18.55 million tons compared to 18.45 million tons in 2022 attributed to an improved labour supply, particularly in harvesters and fresh fruit bunches (FFB) collectors.
Likewise, FFB yield of oil palm estates and oil extraction rate (OER) in 2023 witnessed a rise of 1.9 percent to reach 15.79 tons/hectare and 0.8 percent to reach 19.86 percent compared to the 15.49 tons/hectare and 19.70 percent in 2022, respectively.
According to official data revealed during the conference, the global challenges have resulted in a decline in palm oil exports due to reduced demand by major importing countries, causing a higher palm oil stock. Accordingly, palm oil exports stood at 15.13 million tons in 2023 compared to 15.71 million tons in 2022.