EU alcohol imports blocked in Indonesia

Indonesia is clamping down on imports of European wine, spirits and dairy products in an escalating dispute over the Asian country’s palm oil.

Flying under the radar of the more headline-grabbing spat between the US and European Union in which wine is being heavily penalised, another feud has been bubbling away in south Asia.

The dispute arose last year after the EU declared in March 2019 that as palm oil causes deforestation it is not considered a sustainable or renewable resource anymore.

As such, the trading block said it would be phased out as fuel for transport between 2023 and 2030.

The news was badly received in Indonesia which is one of the world’s leading producers of palm oil – with Malaysia.

The EU biodiesel market is worth an estimated €9 billion a year, with €400 million worth of that coming from Indonesia.

Tensions ratcheted up throughout the year with tariffs being imposed on biodiesel by the EU and then spirits, wine and dairy products by Indonesia and in late December 2019 it was reported by agencies that alcoholic products were no longer being issued import licenses.

A predominantly Muslim country, Indonesia regulates alcohol imports through an import and distribution plan.