Labor & Workforce

Palm oil giant FGV denies labor abuses after US restricts imports

Bangkok Desk, Oct 1 (efe-epa).- One of the world’s largest producers of palm oil, Malaysian company FGV Holdings Berhad, on Thursday denied having committed any labor abuses after the United States banned imports of its products over allegations of forced labor.

In a statement, FGV said it was “disappointed” with the US decision and pointed out that the company had gone to great lengths to protect and uphold the rights of its workers, most of whom are Indonesian or Indian migrants, saying its “efforts are well documented”.

“FGV does not tolerate any form of human rights infringements or criminal offense in its operations,” said the company, which manages over 439,000 hectares of palm plantations in Malaysia and Indonesia, producing some 3 million tons of palm oil per year.

The ban announced by Washington on Wednesday followed a report published in US media alleging suspected abuse at plantations run by FGV, including unpaid wages, child labor, sexual violence and hiring victims of human trafficking.

FGV, with offices in Spain, the US, France, Turkey and Pakistan, said that it hires its workers via legal channels and that it had taken concrete steps to improve its labor practices at the start of the year.

The company also denied allegations made by the Associated Press that it withheld the passports of its employees and “ppays serious attention to any allegation of physical or sexual violence as well as intimidation or threats, and as a responsible company any case of such nature will be acted upon”.

According to figures published on its website, the company posted revenues of 13.26 billion ringgit last year (around $3.1 billions) with exports to Southeast Asia, the Middle East and Europe.

US Customs and Border Patrol (CBP) announced the ban of palm oil and any derived products by FGV on Wednesday, “based on information that reasonably indicates the use of forced labor.”

“The order is the result of a year-long investigation that revealed forced labor indicators including abuse of vulnerability, deception, restriction of movement, isolation, physical and sexual violence, intimidation and threats, retention of identity documents, withholding of wages, debt bondage, abusive working and living conditions, and excessive overtime. The investigation also raised concerns that forced child labor is potentially being used in FGV’s palm oil production process,” the CBP statement said.

Palm oil is used in a huge range of everyday products, including in consumer retail and snack foods, cosmetics, pharmaceuticals, energy and biofuel, among others.

“The use of forced labor in the production of such a ubiquitous product allows companies to profit from the abuse of vulnerable workers,” Brenda Smith, Executive Assistant Commissioner of CBP’s Office of Trade, said.

“These companies are creating unfair competition for legitimately sourced goods and exposing the public to products that fail to meet ethical standards,” Smith added.

Palm oil is one of the most profitable exports for Malaysia and Indonesia, which together produce 85 percent of global palm oil production.

Massive plantations, in addition to being the alleged sites of labor abuses, contribute to rampant deforestation in the region. EFE-EPA


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