Agencies, Jakarta – Indonesia and Malaysia, the world's biggest producers of palm oil, agreed on Monday to work together to fight "discrimination" against the commodity after a meeting between leaders from the countries.
The comments by President Joko "Jokowi" Widodo followed a meeting with Malaysian Prime Minister Anwar Ibrahim, who was making his first overseas trip since being elected last November.
Jokowi said the two countries would "fight discrimination against palm oil" and "strengthen cooperation through the Council of Palm Oil Producing Countries" to address concerns.
The European Union plans to phase out palm-oil based fuels by 2030 because of perceived links to deforestation.
During their bilateral meeting, Anwar and Jokowi signed eight memorandums of understandings covering shipping, export-import financing, green energy, the development of battery industry, which they said they hoped would deepen cross border trade and investment.
The leaders also discussed the development of Indonesia's planned new capital, Nusantara, with Anwar handing over 11 letters of interest from Malaysian companies related to possible investment in the new city, located in Kalimantan.
The new capital could boost regional development, Anwar said, with the Malaysian states of Sabah and Sarawak located in the Malaysian part of Borneo island.
"We hope the development of the capital will bring greater benefits to the wider region, including on Sabah and Sarawak," he said.
It is customary that the first foreign visit of a new Malaysian premier takes place in neighbouring Indonesia, which counts Kuala Lumpur as its fifth biggest export market.
Indonesia this year holds the chairmanship of the ASEAN group of Southeast Asian nations – in which junta-led Myanmar remains a member – and will host a leaders' summit in November.
They were also to discuss migrant worker rights after Indonesia last year imposed a temporary ban on recruitment to Malaysia where the majority of Indonesian migrant workers reside, the ministry said.
Eight Malaysian companies had also signed memorandums of understanding with Indonesian firms worth up to 1.66 billion Malaysian ringgit ($379 million), it said.
A former firebrand student leader, Anwar was a rising political star in the 1990s, becoming finance minister and deputy prime minister.
The 75-year-old political veteran was later sacked and thrown in jail twice before being pardoned and mounting a political comeback.