KUALA LUMPUR ~ Prime Minister Abdullah Ahmad Badawi has shrugged off neighboring Indonesia’s plan to overtake Malaysia as the world’s largest producer of palm oil, describing Jakarta as a friend.

“Indonesia potentially can produce more than us (with their bigger land area). … but it does not matter to us,” he said in a New Straits Times report.

“We are happy if our friends do well,” he added.

Vice President Yusuf Kalla has said his country plans to be the largest palm oil producer by 2008 amid strong demand from the global food, bio-fuel and chemicals industries.

Indonesia is currently the second-largest producer after Malaysia although it had a much larger area for plantations. The two countries account for 85 percent of world production.

Indonesia was expected to produce 17.4 million tonn of crude palm oil this year, topping Malaysia’s 16.5 million tons, the newspaper said.