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IPOSC
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Module 1 - Agricultural Commodities and Sustainability Certification:
Agricultural Transformation, Inclusive Growth and Palm oil in Malaysia: Challenges of Sustainability from a Developmental Perspective
Dr. Isabelle Tsakok
Dr. Tsakok is a development practitioner, policy analyst, researcher and teacher. She holds a PHD in Economics from Harvard. As retired World Bank staff and consultant, she has focused on issues of agricultural transformation, food security, and poverty reduction. She has taught courses on agricultural policy at the World Bank; Renmin University of China; at SIPA, Columbia University, and at the Policy Center for the New South in Morocco. She has worked in most regions of the developing world, including Asia. Her latest book publication is Successful Agricultural Transformation: What it Means and What Makes it Happen (Cambridge Univ. Press)
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Malaysia’s palm oil (PO) complex is a great success story. However, PO’s very success makes it controversial. Sustaining it is both an environmental and a social challenge. Environmentalists point to PO’s contribution to climate change through deforestation, and GHG emissions; loss of biodiversity and threat to rare species. The EU categorizes PO from large plantations as unsustainable, and blacklists PO as a high emitting biofuel, to be phased out in the EU by 2030. Labor rights activists accuse the PO complex of exploiting labor and dispossessing indigenous peoples of their communal land.

The stakes are high for Malaysia, and for the world. For Malaysia, the PO complex contributes around 6% of its GDP. For the world, PO expansion can be either a major source of deforestation and GHG emissions—or a major contributor to Malaysia’s UNFCC and Paris Agreement (2015) commitment on climate change, as well as a powerful engine of agricultural transformation and inclusive growth.

The PO sustainability challenge is viewed too much in Eurocentric terms. Malaysia should view PO sustainability as an integral component of its challenge of achieving high income status through sustainable and inclusive development, within a climate change world. Collaboration, not trade war, is the answer. Together is the only way to effectively reduce GHG emissions and limit global warming. Climate change is our existential threat. We must all fight this common enemy.

To achieve sustainable PO and its developmental priorities, Malaysia has potent options, including: exploiting the substantial productivity reserve in both the PO complex and in the wider agri-food system; turning waste into re-usable resources; empowering smallholders to embrace certification; adopting climate-smart agriculture for productivity and resilience; and lifting the bottom 40% through financial and technical support.

Sustainability through productivity, technology, and social empowerment is the win-win approach for Malaysia and the world.
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