Last week, INPE Brazil’s space research agency announced forest clearance of 13,235 square kilometres, bigger than the area of Ireland’s 10 smallest counties combined. At the same time, the EU has proposed a regulation on banning imports from deforested regions.
The proposed EU legislation was presented by European Commission vice-president Frans Timmermans and the Environment, Oceans & Fisheries Commissioner Virginijus Sinkevicius and has a distance to travel through the European Parliament and approval by the Council of Ministers.
Its application will be limited to cattle (beef), soya, palm oil, timber, cocoa and coffee imports. If the proposal becomes legislation, countries will be classified by the EU as low-, medium- or high-risk in terms of products being from illegally deforested areas. Importers will be required to ensure products are in compliance.
Biggest deforestation since 2006
In the week that Brazil’s space agency announced the clearance of the largest area of forest since 2006, the view of farmers will be that such a policy is long overdue.
Cessation of deforestation and replanting was a condition of the Mercosur trade agreement made in 2019, yet forest clearance has increased every year since then as opposed to stopping.
It now stands at three times the level in 2012 and is at total variance with everything agreed by Brazil at the recent COP26.
However, just because this proposed EU legislation may appear to make sense, there is no guarantee that it will not be challenged as a non-tariff barrier to trade.
Elsewhere in Brussels, environmental NGOs welcome the proposal
There is a question over whether the proposals on benchmarking individual World Trade Organisation (WTO) member countries are compatible with WTO rules on an open, transparent and equitable multilateral trading system as flagged up by Copa Cogeca, the EU umbrella body for farm organisations.
Elsewhere in Brussels, environmental NGOs welcome the proposal with some saying that it does not go far enough by including only six product categories.
From a fairness to EU farmers’ perspective, such a policy should be the minimum given the level of EU ambition in Farm to Fork in curtailing the ability of farmers to maximise the output from their land.
Yet, there is a difference under WTO global rules in that the EU is free to place whatever requirements it chooses on production within its territory but it cannot dictate what takes place beyond EU borders, particularly if it is not in compliance with WTO rules.
The best example of this that will be familiar to farmers is the policy on use of growth-promoting hormones in beef cattle.
The EU banned the use of these for production in 1988 and subsequently imposed a ban on beef imports that were treated with growth-promoting hormones.
Of course, there is a long way to go before this proposal comes into EU legislation
This policy was challenged successfully by the US and the EU made a side deal with the US for a special tariff-free quota for 30,000t of non-hormone-treated beef. This has been accepted by the US though the policy could likely be successfully challenged by other countries if they choose to do so.
The reason they haven’t is probably more due to the EU level of tariffs than likelihood of success.
Of course, there is a long way to go before this proposal comes into EU legislation.
Although there has been no reaction so far, Brazil may see this as a way to take some of the spotlight off it and it is also in the process of challenging EU policy on chicken imports at the WTO.
What might look like a perfectly logical proposal to Irish farmers is not guaranteed to ever become implemented policy. Given the WTO constraints on policy demands beyond the EU, the EU should stop and reflect on internal EU policy demands on farmers that may not be able to be replicated externally.
It was clear at COP26 that the EU has gone out on a limb globally with Farm to Fork and it will not be able to make this global policy without global agreement. Their power to influence externally is limited to what can be achieved in negotiation and making it a condition of preferential tariff agreements is the logical route. Ambition beyond that may well fall at WTO as it did with beef hormones.