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EU green transition must be fair to domestic and overseas farmers




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Already grappling with sky-high costs and climate blows, EU farmers now face a looming threat from the Commission. The European Parliament’s agriculture committee is challenging the EU executive’s industrial emissions directive (IED) reform proposals, which would subject more livestock farmers to mandatory, costly “pollution permits” aimed at slashing the bloc’s industrial carbon emissions, writes Colin Stevens.

While initially applying to roughly 4% of pig and poultry farms, the Commission’s new IED plans would cast the net significantly wider by lowering the size threshold at which farms are classified as “agro-industrial.” Earlier this month, member-state farming representatives criticised the Commission’s failure to account for regional needs and farm type, such as small-scale or family-run, which they argue are being unfairly targeted.

These proposals constitute a direct menace to the viability of the farmers at the core of the bloc’s food system, continuing a trend of well-intentioned yet ill-conceived EU food policies.

Global trade tensions mounting

Notably, detractors of the IED reform have highlighted the risk that a consequent decline in local production could “lead to increased dependency on exports,” which would be antithetical to the EU’s green, health and competition goals.

The bloc’s agri-food standards are sparking tensions between EU and global trading partners, such as Indonesia, India and Brazil, which decry Brussels’s sustainability regulations as unfair, excessively costly trade barriers amounting to “regulatory imperialism.” A notable example is the EU’s Carbon Border Adjustment Mechanism (CBAM), a green levy designed to protect the internal market from torrents of cheap agricultural imports from countries with looser environmental production standards and reduce the EU’s exporting of agricultural carbon emissions.

Even EU-US agricultural trade relations have become increasingly strained, with a long-running tariff dispute between Spain and the US over the former’s olive exports still unresolved. The EU Parliament’s agriculture committee recently met to discuss the olive tariff, which the US imposed in 2018 on the grounds that the bloc’s Common Agricultural Policy (CAP) subsidies were harming American counterparts. European farming representatives and MEPs have warned that this policy constitutes a “direct attack on the CAP,” while emphasising that local producers of meat, olive oil and other European staples from across the bloc could face similar protectionist powerplays.


EU food label adding further challenges

Ironically, these same European farmers are also facing an impending risk from EU policy. As part of 'Farm to Fork', the bloc’s healthy, sustainable food strategy, the Commission is developing a proposal for a harmonised Front-of-Package (FOP) food label to tackle rising obesity.

While once considered a shoo-in, the Commission has indicated that France’s Nutri-Score will not be adopted. It remains unclear what the EU executive will decide, as it is considering incorporating elements of several existing systems, although combining imperfect labels seems unlikely to result in a positive outcome. Nutri-Score’s fall from grace can largely be attributed to the outcry from governments, farming associations and nutritionists across Europe, who have highlighted its imbalanced algorithm, which weighs “negative” nutrients - namely salt, sugar and fats - much more heavily than positive nutrients, leading to deceptively harsh scores for traditional European products.

This flawed scoring system not only adds to the already-substantial economic and competition challenges facing local pig, dairy and olive oil farmers, but also fails consumers. Johanie Sulliger, a Swiss-based dietician, has explained that because Nutri-Score’s algorithm does not evaluate micronutrients such as vitamins and minerals, products that nutritionists would not normally recommend can receive highly positive scores, concluding that the label does not support a balanced diet.

South America’s food label foray

Ahead of a possible 2023 decision, the Commission should look to food label experiences in South America. In 2016, Chile introduced a black stop-sign label that alerts consumers of products high in sugar, salt and fat, with similar, negative-focused FOPs implemented in Uruguay, Peru and Ecuador.

Research on Chile’s FOP has revealed a drop in “high in” product purchases, but a comparatively weak rise in healthy food consumption, and even a slight increase in child obesity. Moreover, highly educated households have seen a greater reduction in unhealthy calories than less educated households, while lower-income households have made less progress in healthy calorie intake. Similarly, a 2019 study found that Ecuador’s food label had only “a marginal impact on consumer purchases, and primarily among those of higher socioeconomic means.”

This unequal impact reflects an existing consensus on the link between education and response to nutritional information. Simply adding FOP labels is not enough to meaningfully improve public health, as it risks confusing consumers and exacerbating existing health gaps. This is particularly concerning for Europe, where obesity is rising fastest among low socioeconomic groups.

Local farmers key part of solution

With the EU’s ambitions for a healthy, sustainable food system imperiled by deteriorating trade relations on one hand, and a potentially misguided food label on the other, Brussels needs a new model.

Finding common ground between Brussels, its trading partners and its own farming sector will be challenging, but solutions should start by supporting local producers. As sustainable agriculture experts Lasse Bruun and Milena Bernal Rubio have argued, putting “small-scale producers…front and center,” could “help reverse years of damage, fight food insecurity and increase agroecological production.” Crucially, this approach would entail supporting both domestic farmers and those of trading partners in South America and other high-exporting regions.

While the EU is justified in maintaining strong environmental trade standards, both on sustainability and competition grounds, it should compensate for the economic impact on emerging economies by financially supporting their green agricultural transition. Encouragingly, Dutch MEP and carbon levy rapporteur Mohammed Chahim has said that its impact would be counterbalanced by tens of billions in overseas climate projects to ensure an environmentally and economically just transition in Europe and abroad.

This same spirit of green transition burden sharing should be applied to internal policies, such as the IED reform proposals under discussion in the EU Parliament, another example of well-intentioned but ultimately out-of-touch policy from Brussels. Moving forward, the EU must direct its Green Deal policies to building a food system with empowered local producers at its core.

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