The EU-Mercosur trade agreement will fuel intensive farming
14 April 2021
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The European Union and Mercosur states – Argentina, Brazil Paraguay and Uruguay – reached a political agreement for an ambitious, balanced and comprehensive trade agreement.
Nearly two years after the end of the EU-Mercosur trade negotiations, the European Commission finally published the related final Sustainability Impact Assessment (SIA), which confirms the findings of the draft SIA published in July 2020: if ratified as it stands, the agreement will fuel intensive farming, which is detrimental to animals, people, and the environment.
This SIA was released as the ratification of the EU-Mercosur agreement is for now uncertain due to the various concerns raised by civil society organisations. The European Parliament and several Member States, including Austria and France, have pledged not to ratify the deal “as it stands”, mainly because of the significant negative impact the deal will have on deforestation.
In this context, the SIA tries to defuse some of these concerns by downplaying the impact the deal will have on the expansion of agriculture, and therefore on deforestation. Indeed, the SIA recognises that, in the beef sector, “EU imports from Mercosur will increase in both scenarios (…) but that most of the deforested area is used for low-efficiency cattle ranching”. Hence, the SIA suggests that “there is great scope for expanding production by intensifying beef production in these areas without inducing deforestation”. However, fuelling the intensification of animal farming is extremely detrimental to animal welfare, but also to people and to the environment as intensive farms often not only rely on crop-based feed, whose production fuels deforestation, but also generates high levels of air, ground and water pollution. Furthermore, the SIA seems to ignore that, according to a research by Global Forest Watch, the impact of the beef sector on deforestation is five times higher than any other industry, and deforestation rates are increasing worldwide. For instance, in Brazil alone, over half of the country’s deforestation over the last twenty years came from the beef sector, mainly due to the conversion of forests into cattle pasture. As a reminder, the Ambec report – the impact study commissioned by the French government – concluded that, as it stands, the EU-Mercosur agreement would generate an extra 25% of deforestation in the six years following its entry into force.
The SIA also draws worrying conclusions concerning the Trade and Sustainable Development (TSD) chapter. It recognises that the potential impact of TSD provisions are uncertain, “insofar as they remain contingent upon implementation in good faith of all parties”. The decentralisation of environmental regulation in key countries like Brazil can increase this uncertainty. Hence, the environmental concerns are not likely to be addressed unless there is unilateral EU legislation guaranteeing imported products are deforestation-free, or that EU standards, including animal welfare standards, apply to imported products.
We regret the late publication of this SIA, which according to the Commission’s own policy, should have contributed to discussions during the negotiations of the agreement. It is worth noting that the European Ombudsman found that:
“the failure of the European Commission to ensure the finalisation of the sustainability impact assessment before the end of the EU-Mercosur trade negotiations constitutes maladministration” and “risks weakening European and national parliaments’ ability to comprehensively debate the trade agreement”
The European Commission also published a Position Paper commenting on the main findings of the SIA report, but it does not not mention any strategy to address the underlined shortcomings or any next step to be taken. For instance, on the beef sector, it supports intensification of the production, regardless of the very negative impact it would have on animal welfare, public health and the environment. Instead of endorsing intensive farming, which is the main driver of deforestation in the Amazon forest, the European Commission should acknowledge that addressing deforestation cannot depend solely on the political will of EU and Mercosur countries, given the economic weight of the beef sector in Mercosur, and the constant imports of beef and soy from the EU.
We thus call on the EU to uphold the objectives of the Farm to Fork Strategy, which are to use trade policy “to obtain ambitious commitments” from partners in key areas such as animal welfare, and to take this opportunity to negotiate the adoption by Mercosur countries of EU-equivalent legal standards in key sectors (cattle, broiler chicken, laying hens), as well as in terms of transport, or to agree on conditions on animal welfare and sustainability to access tariff-rate quotas or liberalisation in animal products, including the respect of EU-equivalent animal welfare standards.