Johari told the Dewan Negara that the move aimed to position Malaysia as an SAF hub while boosting foreign investor confidence in the local industry, Utusan Malaysia reported.

“The government is streamlining the approval of licences for the construction of plants, production, and export of SAF to make it easier for industry players to operate in Malaysia.

“This move sends a strong signal of support to investors looking to engage in the sector,” he said in response to Senator Che Alias Hamid, who asked about government efforts to attract foreign investors beyond tax incentives.

Johari said the government was leveraging Malaysia’s position as the world’s second-largest palm oil producer, using raw materials like used cooking oil (UCO), palm mill effluent oil, and other palm biomass for SAF production.

Johari added that the government was raising public awareness about UCO collection and studying mechanisms to ensure the sustainability of raw materials for SAF production.

Last week, the International Air Transport Association (IATA) revealed that global SAF production growth is projected to slow down and reach 2.4 million tonnes next year.

SAF output for 2025 was expected to reach 1.9 million tonnes, double the amount produced the previous year. However, the figure was a downward revision from IATA’s earlier forecast of around 2.1 million tonnes, which it attributed to insufficient policy support to fully leverage the installed SAF capacities.

IATA director-general Willie Walsh said poorly designed SAF mandates stalled momentum and that policymakers must now work with the airline industry to design incentives that would work.