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Palm oil producing countries hit back at EU deforestation regulations

The deforestation regulation was originally proposed by the European Commission in November 2021.

It aims to require companies to ensure that all goods sold inside the EU have “not been produced on deforested or degraded land” and are therefore “deforestation-free”. All other products would be banned.

It was finally put to a vote by Parliament on September 13, 2022, after almost a year of debate, and passed comfortably.

Strong opposition has been mounted by developing countries, especially countries that produce commodities such as palm oil, as they would be designated as “high risk”.

They claim that the regulations are a “protectionist political tool”.

“This proposal is a protectionist ploy to block palm oil imports and must be abandoned,”The Chairman of the Indonesian Palm Oil Association (GAPKI), Joko Supriyono, said via an official statement.

“The European Union should pursue genuine cooperation with producing countries to ensure that businesses and consumers have access to essential food at low prices and with high sustainability standards. The current regulations do not achieve this; in fact, it would raise prices.

This opposition recently culminated in an official letter of protest to the EU regarding the vote, which FoodNavigator-Asia viewed. It was signed by a coalition of 14 developing countries, including Indonesia, Brazil and Malaysia, and covers several commodities in addition to palm oil such as livestock, soybeans, cocoa and coffee.

“This proposed regulation does not take into account local conditions and national legislation in developing producing countries. [and] their efforts to combat deforestation [and] encourage the EU to undertake further consultations with other countries [as some of the concerns we have expressed] in the formal public consultations have, unfortunately, been little taken into account.

“Although we agree that the fight against climate change, conservation and sustainable management of forests are urgent tasks, we regret that the EU has chosen the option of unilateral legislation instead of an international commitment.

The 14 coalition countries were: Indonesia, Malaysia, Brazil, Nigeria, Argentina, Colombia, Ghana, Guatemala, Ivory Coast, Paraguay, Peru, Honduras, Bolivia and Ecuador.

The coalition also described how the proposed deforestation regulations and various aspects of its benchmarking system are biased against producing countries and their products, using the term “discriminatory” repeatedly throughout the letter.

“The country assessment criteria and benchmarking system are inherently discriminatory and punitive – Its most likely effect will be to generate trade distortions and diplomatic tensions, with no environmental benefits,”they declared

“Furthermore, it imposes additional controls, entails reputational risks for companies and is likely to penalize producers in developing countries, in particular smallholder farmers and SMEs.

“Trade restrictions or the threat thereof cannot be a preferred means of achieving environmental goals. We strongly believe that trade restrictions are inadequate to address environmental concerns and will only lead to a downward spiral of trade distortion, reduced trade opportunities and further impoverishment, with limited or even negative effects for conservation. forests.

The letter also highlighted concerns about the “discriminatory nature of the range of products” included in the regulation – namely products such as palm oil – as well as the one-sided definitions of various terms such as “deforestation” not agreed by all parties. involved and various other demands that could increase costs for everyone involved.

Strong local support for deforestation – but is it the same thing?

Consumer support for deforestation appears to be very strong in the EU, as evidenced by a survey by news company GlobeScan of 9,000 consumers in nine EU countries – Austria, Czech Republic, France, Italy , Portugal, Germany, Spain, Sweden and the Netherlands.

The survey highlighted deforestation as “the biggest environmental problem of concern”​ with 80% of Europeans saying this is a concern, and also that many consumers “Strongly supports a no-deforestation law that would force EU companies to stop selling products that destroy the world’s forests”​.

“Due to the public perception that big business is failing in their responsibility to prevent deforestation, there is a strong appetite for regulation,”the researchers said.

“For companies, consumer trust and loyalty are also at stake [so] businesses have more to gain from supporting this new regulation than from opposing it.

Unfortunately for producing nations, the survey also claims that around 81% of Europeans support zero deforestation law enforcement, and this is supported across different ages and demographic groups.

However, a closer look at the survey shows that consumers have only received a very positive introduction to the new law – that is, it “stop deforestation and minimize the EU’s impact on forests worldwide”by mandating “companies that sell products linked to deforestation and forest degradation to ensure that they are ‘deforestation-free’ before placing them on the European market or exporting them from the EU”.

Faced with such an introductory statement with little explanation of the pros and cons, it would be hard to imagine consumers saying no and thus saying they support deforestation – even if they don’t know how the regulation on deforestation is likely to affect the economy, local food supply and international trade relations.

Given the rise in inflation rates in Europe (9.1% in August 2022 compared to 3.4% in September 2021) and the way it is reaching new highs in various areas, from food prices to energy costs, this latest move means it could accelerate further when the regulations are enforced. .