Affirming the Total Ban on CPO Exports, Jokowi: The State Needs Taxes, But…

President Joko Widodo (Jokowi) reaffirmed the government’s policy to ban the export of raw materials and cooking oil products.

Jokowi said the export ban was carried out to meet the supply of cooking oil which was scarce in the country. According to him, this policy must be taken even though the export of palm oil when prices are high can bring blessings from the side of state revenues including taxes.

“I know the country needs taxes, the country needs foreign exchange, the country needs a trade balance surplus. But meeting the people’s basic needs is a more important priority,” he said via video conference, Wednesday (27/4/2022).

Jokowi said that meeting the basic needs of the community is a top priority for the government. According to him, the ban on palm oil exports can be a solution to increase the production and supply of cooking oil in the country.

He considered the scarcity of cooking oil in the largest palm oil-producing country in the world ironic. Therefore, business actors are asked to look at the problem more clearly so that the scarcity of rare cooking oil in the last 4 months can be resolved.

Jokowi explained that the ban on exports of crude palm oil and cooking oil applies to exports from all parts of Indonesia, including from bonded areas.

“This prohibition does have a negative impact, it has the potential to reduce production, and farmers’ harvests are not absorbed. However, the purpose of this policy is to increase domestic supply so that supply is abundant,” he said.

Jokowi then asked the palm oil industry awareness to prioritize the fulfillment of domestic cooking oil needs. Reflecting on the production capacity, he believes that the domestic demand for cooking oil can be easily met.

In addition, the volume of raw material for cooking oil produced and exported is also much larger than domestic demand. According to him, domestic needs will be met if all parties are willing and have the intention to prioritize the needs of the people.

“This is my benchmark for evaluating the policy. Once domestic needs have been met, of course, I will lift the export ban,” he added.

Previously, the Coordinating Minister for the Economy Airlangga Hartarto announced that the policy of banning the export of palm oil products had begun today, April 28, 2022. The export ban applies to crude palm oil (CPO), and red palm oil (RPO). ), palm oil mill effluent (POME), as well as refined, bleached, deodorized (RBD) palm olein, and used cooking oil.

The government said it would take firm action against those who violate the regulations for banning the export of palm oil.

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