16/5/06 KUALA LUMPUR (AFP) - Malaysia has hit back at allegations its palm oil industry kills orangutans by clearing forests, saying it was an attempt by industry competitors in the developed world to undermine the sector.

Energy, Water and Communications Minister Lim Keng Yaik charged that developed countries which produce oils and fats were engaging in a smear campaign in the face of stiff competition from palm oil.

"They know they cannot compete with palm oil so how do they fight you? They find some reason and hit you below the belt," Lim said at the launch of regional headquarters here for Netherlands-based biofuel traders BioX Group B.V.

"They come up with 'Palm oil kills ... the orangutan'," said the minister in a fiery speech, during which he repeatedly mimicked orangutan noises.

"So we have to fight that. Don't worry ... we will. When Malaysians get angry, they fight. And I guarantee you we will win," said Lim.

Palm oil in Indonesia and Malaysia has been blamed for destroying vast swathes of jungle, pushing endangered animals such as the orangutan to extinction, and creating Southeast Asia's annual haze crisis as forests are burned off for plantations.

But Lim said the campaign over the large red-haired apes, which are native to Malaysia's eastern states on Borneo island, emerged after palm oil exports from Malaysia to the     European Union more than tripled.

He said no forests were cleared for plantations and natural forest still covered some 64 percent of Malaysia.

"What more do you want? Do you want us to be 100 percent covered with natural forest, so that we don't use cars, so that we swing from tree to tree like Tarzan and Jane? So that you can come and take photos of these loin-clothed natives?"

Most of Malaysia's palm oil plantations were converted from existing rubber plantations, with the last plantations opened up 40 years ago, he said.

"We owe no apology to anyone to use our forest for our own use. Just like the Europeans used up all their forests for their own use," he said.

Malaysia is the world's largest palm oil producer, accounting for about half of global output. Itaims to become the world's top producer of palm oil-based biodiesel amid an aggressive expansion in its palm oil production as demand soars for the alternative fuel.