NEAC said industry calculations suggested that the sector’s share of real gross domestic product could grow to 7.6% by 2020 from 3.2% in 2008 if the value-added gains from efficiency and innovation could be realised.

“This would translate into a yearly growth of 13.7% from 2009 to 2020.

“Palm oil exports can also grow by 7% per annum to RM84.6bil by 2020, probably more if new palm oil-based products and services can be successfully marketed,” it said.

Carbon trading

The report said the potential of the palm oil sector becoming the lead in terms of the sustainability pillar in the NEM also depended on the future of carbon trading – which was uncertain due to lack of agreement on setting binding international targets at the recent Copenhagen negotiations.

Carbon trading is a process of buying and selling carbon credits. Large companies or organisations are assigned a quota of carbon that they are allowed to emit. If a company’s emissions are less than its quota, it can sell credits; if emissions are more, it will need to buy carbon credits.

“Thus, Malaysia should consider intensifying efforts to get plantation land to be recognised internationally as natural carbon sinks.

“The industry can also develop an intra-community market using the Roundtable on Sustainable Palm Oil (RSPO) in tandem with the development of Certified Sustainable Palm Oil.

“For example, downstream RSPO members can buy carbon credits from upstream growers,” it said.THE END

Source: The Star