As the United States and China engage in a bitter trade dispute casting a dark shadow over the global economy , another trade spat is threatening to escalate between the European Union and Indonesia. The EU has imposed countervailing duties of 8% to 18% on biodiesel from Indonesia — the world’s largest producer of palm oil — to counter alleged government subsidies enjoyed by the producers in the country. Jakarta has vowed to retaliate with counter tariffs of 20% to 25 % on EU dairy products. The tariffs are likely to further escalate an ongoing feud over palm oil between the two trading partners. Earlier this year, the EU rankled Jakarta after its executive body said the bloc would phase out palm oil from transportation fuel by 2030 as palm oil cultivation, with some exceptions, caused deforestation. “Escalating tariffs in a larger ‘trade war’ will hurt the Indonesian economy more than that of the EU members in the long run,” Jarryd de Haan, a research analyst at Australia-based strategic research institute Future Directions International, told DW. “So, it’s unlikely that the Indonesian government would engage in tit-for-tat tariffs if there is a significant risk of an escalating trade dispute.” Nearly… Read full this story
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