Meeting China’s Global Resource Needs

The report identifies China as highly vulnerable to palm oil supply disruptions due to its 98% import dependence and the concentration of production in Malaysia and Indonesia. It highlights critical sustainability risks, particularly deforestation, biodiversity loss, and greenhouse gas emissions, which pose both reputational risks to enterprises and systemic risks to national supply security. The document recommends five policy steps for the Chinese government, including building embassy capabilities, engaging with international standards, exploring fiscal incentives, implementing green public procurement, and integrating supply chain risk into corporate social responsibility guidelines.

• China is extremely dependent on imports for its palm oil needs, with a 98% import dependency ratio, and is the world's second largest importer and third largest consumer of the commodity.
• China's palm oil supply is highly concentrated and vulnerable to disruptions, as 96% of imports originate from Malaysia, Indonesia, or India, and 37% come from countries with high or extreme political risks.
• Deforestation is the most significant environmental impact of palm oil, with estimates that 30% of oil palm expansion in Malaysia and Indonesia between 2005 and 2010 occurred at the expense of natural forests.
• Palm oil production has severe biodiversity impacts, particularly in Indonesia and Malaysia, leading to the destruction of habitats for species such as the Sumatran tiger and orangutans.
• The industry is linked to significant greenhouse gas emissions; Indonesia's palm oil industry alone could generate up to 558 million megatonnes of carbon by 2020, exceeding Canada's national emissions.
• Social risks include the forced displacement of indigenous and local communities and poor worker health and safety, with reports of forced labour in Malaysia and debt bondage in Indonesia.
• Chinese palm oil imports are dominated by foreign investment and private enterprises, which together accounted for 80% of imports in 2011, while state-owned enterprises accounted for approximately 10%.
• The report identifies a critical governance gap in China, noting that no single ministry or department has an overall mandate for understanding and managing the country's import footprint.
• The report proposes five specific policy interventions for the Chinese government: enhancing embassy capabilities, strengthening engagement with international standards, exploring fiscal measures, integrating green public procurement, and updating CSR guidelines.

APA

Potts, J., Huppé, G. A., Dion, J., Voora, V., & Forstater, M. (2014). Meeting China’s Global Resource Needs. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/china_global_resource_palm_oil.pdf

Chicago

Potts, Jason, Gabriel A. Huppé, Jason Dion, Vivek Voora, and Maya Forstater. Meeting China’s Global Resource Needs. International Institute for Sustainable Development, 2014. https://www.iisd.org/system/files/publications/china_global_resource_palm_oil.pdf.

Wikipedia

{{cite report |last1=Potts |first1=Jason |last2=Huppé |first2=Gabriel A. |last3=Dion |first3=Jason |last4=Voora |first4=Vivek |last5=Forstater |first5=Maya |title=Meeting China’s Global Resource Needs |publisher=International Institute for Sustainable Development |date=February 2014 |url=https://www.iisd.org/system/files/publications/china_global_resource_palm_oil.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{potts2014meeting, author = {Potts, Jason and Huppé, Gabriel A. and Dion, Jason and Voora, Vivek and Forstater, Maya}, title = {{Meeting China’s Global Resource Needs}}, institution = {International Institute for Sustainable Development}, year = {2014}, month = feb, url = {https://www.iisd.org/system/files/publications/china_global_resource_palm_oil.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }