27 February 2002 (Business Times) - MALAYSIA and Russia are expected tosign a US$50 million (US$1 = RM3.80) Palm Oil Credit Payment Arrangement,Pocpa, on March 10.Government officials said under the agreement, about 200,000 tonnes ofpalm oil will be delivered to Russia over two years on a credit basis.Prime Minister Datuk Seri Dr Mahathir Mohamad is expected to sign thePocpa agreement with Russian Federation President Vladimir Putin.The two countries were supposed to have formalised the pact last Septemberbut the Prime Minister’s trip was cancelled following the terroristattacks on the US on September 11. Dr Mahathir was to have visited Russiafrom September 12 to 15 and Germany from September 18 to 20 last year.During his three-day official visit to Russia next month, Dr Mahathir willbe accompanied by Primary Industries Minister Datuk Seri Dr Lim Keng Yaikand officials from the Malay-sian Palm Oil Board and the Malaysian PalmOil Promotion Council. Dr Mahathir is also expected to be accompanied byseveral Cabinet ministers and a trade delegation from the private sector.The Prime Minister will discuss several bilateral issues with Putin.Under Pocpa, which was introduced by the Government in 1992, credit isoffered to long-term buyers of Malaysia’s palm oil. The countries, inparticular those which face a shortage of foreign exchange, are normallygranted a two-year credit line to buy the commodity from Malaysia.The bilateral payments arrangement scheme promotes counter trade involvingthe exchange of palm oil for a host of products, while expanding theglobal market for the Malay-sian commodity.Products include the exchange of palm oil for machinery, rice, groundnutoil, sesame seed, beef and others.Pocpa also encourages research and development on palm oil betweensignatory countries.Of the US$500 million allocated for the scheme, Malaysia as of March 21last year hasextended US$227.4 million in credit to nine countries.The recipients are Algeria, Sudan, Pakistan, Iraq, Iran, Myanmar,Bosnia-Herzegovina, Cuba and North Korea.New deals in the works include those with Egypt, Bangladesh, Ukraine,Djibouti, Hungary, the Czech Republic, and other countries in Africa andSouth America.Malaysia was exporting between 350,000 tonnes and 400,000 tonnes of palmoil a year to the former Soviet Union before its collapse, of which 80 percent was consumed by Russia. Since 1993, Russia has been buying between40,000 tonnes and 60,000 tonnes a year.According to the Malaysian Palm Oil Board, Russia bought 47,802 tonnes ofthe commodity valued at RM62 million in 1999 and 64,229 tonnes valued atRM67.5 million in 2000.