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According to Industry Official, Malaysia and Indonesia, the world's mainpalm oil producers, are hoping to cooperate to boost prices and to easetension that has arisen as they battle for market share. "I see bothsides as having similar intention", Derom Bangun, chairman of theIndonesian Palm Oil Producers' Association (Gapki), told Reuters fromMedan, on Indonesia's Sumatra island. "I have the impression the(Indonesian) government wants to cooperate ....that the Indonesiangovernment is starting to pay attention to the fate of the CPO (crude palmoil) business in Indonesia", he said.


Bangun said he had spoken with Malaysia's Primary Industries Minister LimKeng Yaik and Indonesia's Trade and Industry Minister Luhut Pandjaitanover the need to join hands to help improve the market, which currentlyhovers at a 15-year low. But officials from both sides there had not yetbeen any discussion on cooperation to fix prices or production levels.For now, talk was on cooperation on marketing, Bangun said. "What Iunderstand is that Malaysia hopes to see it and Indonesia working togetheron promotion, which means spending money in an effort to expand outlets",said Bangun.

"There are countries which are not acquainted with palm oil. To make themacquainted, we need to penetrate (the markets)," he said. An Indonesiantrade and industry ministry official said in October both countries hadagreed to cooperate to bolster tumbling prices and concrete measures wouldbe discussed later. Officials at the Primary Industry Ministry in KualaLumpur said there had not yet been any follow-up on cooperation measures.Bangun said Malaysia's had come up with three proposals for discussion ---marketing, research and development, and cross investment, which meantbusinessmen from Indonesia and Malaysia being able to do business ineither country. "We need to formulate cooperation in a much better way.I always try to find ways in which it can be realised as soon aspossible", Bangun said.

Indonesia expects to produce 7.3 million tonnes of palm oil in 2001,compared with 6.5 million in 2000, according to Gapk

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