
InfoSAWIT, KUALA LUMPUR – Indonesian Minister of Trade, Budi Santoso, accompanied President Prabowo Subianto in a meeting with Malaysian Prime Minister Anwar Ibrahim in Kuala Lumpur on January 27. The meeting resulted in an agreement to strengthen strategic cooperation across various sectors, with a primary focus on the palm oil industry.
During the meeting, President Prabowo emphasized the global demand for palm oil, stating that many countries express a need for it, thus necessitating enhanced cooperation between Indonesia and Malaysia in this sector. "Every country we visit always mentions the need for palm oil. President Prabowo hopes that cooperation between Indonesia and Malaysia in this sector can be improved," Minister Budi Santoso stated in an official release on January 30, 2025.
As the two largest palm oil producers in the world, contributing 80% of global production, Indonesia and Malaysia play a crucial role in maintaining market stability for this commodity. Minister Budi Santoso expressed appreciation for Malaysia's support in strengthening cooperation in the palm oil sector and affirmed that the Indonesian Ministry of Trade is ready to follow up with concrete steps to enhance collaboration.
"Indonesia hopes that collaboration between Indonesia and Malaysia continues to address emerging export barriers for palm oil in various countries," said Minister Budi Santoso.
Malaysia is a strategic trading partner for Indonesia, ranking as the sixth-largest export destination and the fifth-largest source of imports. From January to November 2024, total trade between the two countries reached USD 21.06 billion, with Indonesia exporting USD 10.97 billion to Malaysia and importing USD 10.09 billion. Consequently, Indonesia recorded a trade surplus of USD 882 million.
In 2023, total trade between Indonesia and Malaysia reached USD 23.2 billion, with Indonesia's exports to Malaysia amounting to USD 12.5 billion and imports totaling USD 10.8 billion, resulting in a trade surplus of USD 1.7 billion for Indonesia.
Key non-oil and gas export commodities from Indonesia to Malaysia in 2023 included mineral fuels, fats and vegetable oils, vehicles, iron and steel, and copper. Meanwhile, Indonesia's main imports from Malaysia included machinery and mechanical equipment, plastics, electronic equipment, organic chemicals, and iron and steel.
In the investment sector, Malaysia ranked fifth as a source of Foreign Direct Investment (FDI) for Indonesia in 2023, with total investments reaching USD 4.06 billion, a 21.4% increase from the previous year. This indicates a strengthening economic relationship between the two countries, particularly in strategic sectors like palm oil.
With increasingly close cooperation, Indonesia and Malaysia are expected to strengthen their positions in the global market and address various challenges arising in the palm oil industry. (T2)