KUALA LUMPUR, June 22 (Bernama) -- North Korea is keen on having a countertrade arrangement with Malaysia in its quest to buy more palm oil from thecountry.

"Malaysia has been sending palm oil to North Korea, under the Palm OilCredit Payment Arrangement (POCPA)," said Minister of PlantationEnterprises and Commodities, Datuk Peter Chin Fah Kui, at a pressconference, here Tuesday following more than an hour long discussion witha visiting delegation from North Korea.

The mission from North Korea was led by its Minister of Foreign Trade, RimGyong Man.

North Korea had been given a credit of US$20 million for the palm oil andthey have used up almost the entire amount now, and have paid back US$1million todate through installments, Chin said.

In view of this, Chin said a counter trade arrangement has been suggestedon his side to increase the export of palm oil to North Korea.

Chin said he had asked Rim to suggest the goods that could be countertraded for the palm oil.

"This means that there would be no need for cash payment but the sale ofgoods that could be exported to Malaysia," he said.

The North Korea party is very agreeable to the suggestion and hasrequested for more credit, Chin said, adding that among the goods thatcould be offered for the counter trade from Korea are minerals, ginseng,machine, steel and also mini and medium scale hydro plants.

Malaysia is a leading producer and exporter of palm oil. Last year itproduced a total of 13.4 million tonnes and exported 12 million tonnes.

The POCPA scheme is currently enjoyed by nine importing countries, namelyAlgeria, Cuba, Iran, Iraq, Egypt, Russia, Myanmar, Sudan and North Korea.

Under the POCPA scheme, these countries are allowed to make their paymentsthrough installments covering a period of two years.

Meanwhile, asked on the focus of his Ministry, Chin who took over theportfolio only few months ago, said he would be concentrating onencouraging forest plantation, and would be forming a scheme for thepurpose.

"We are looking into the finer details before discussing with the Ministryof Finance and later the Cabinet for approval," he said.

"As the minister, my focus is to ensure that the timber industry hasenough raw materials so that factories could continue to opeate," he said.He added that natural forests were on the decline presently.

He said that he would be discussing with the states to seek for landsuited for plantation including forest plantation.

Currently only five states in Malaysia have sufficient land for plantationpurposes, namely Sarawak, Sabah, Pahang, Terengganu and Kelantan, headded.