T uesday, April 27, 2010 
12:48 Mecca time, 09:48 GM 
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Two leading consumer-goods companies, Unilever and Nestle, have stopped buying 
palm oil for use in its products from Indonesia's largest producer, Sinar Mas.

The firm is accused by Greenpeace, the environmental activists, of illegally 
clearing forests in Indonesia for its plantations.

Sinar Mas denies the claims and says it has hired independent auditors to prove 
its case.

In a telephone interview on Tuesday to Al Jazeera, Vikram Agarwal, Unilever 
Asia's vice-president of supply management in Singapore, said: "Unilever's 
decision to suspend these purchases of palm oil was triggered by serious 
charges made against the company. Not just in December 2009, but going back to 
when the first quotes appeared from Greenpeace in April 2008, as well from 
other NGOs [non-governmental organisations] and independent auditors."

He said the purpose of "making our purchases as of now is to make it clear to 
them that the burden of proof now rests with them [Sinar Mas] to either dismiss 
these allegations or to come out with some verifiable actions that will satisfy 
everybody, that they are going to take measures to rectify the situation."

Southeast Asia is the world's biggest supplier of palm oil, with Malaysia 
having more than 4.5 million hectares of palm plantations. Indonesia has about 
seven million hectares. The two countries account for 90 per cent of global 

Rainforest loss

Environmental groups have said that palm oil is the most significant cause of 
rainforest loss in these countries.

One study has said that 86 per cent of Malaysian deforestation between 1995 and 
2000 was to make way for palm plantations.

It is believed by some groups that Indonesia has already lost about 75 per cent 
of its original forest.

But growers have said that the palm-oil sector provides employment to about 1.4 
million Malaysians, and, according to Sinar Mas, 4.5 million Indonesians are 
directly employed in the palm-oil sector .

It is estimated that in 2009 Indonesia and Malaysia earned about $10bn and 
$15bn, respectively, from palm-oil exports

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