Lessons Learned from the EU Cocoa Talks and what does this mean for other EUDR partnerships?

The event aimed to learn lessons from the EU Sustainable Cocoa Initiative at a time that various EU regulations, such as the Regulation on deforestation-free products (EUDR) are coming on line and legally requiring that only sustainable cocoa be exported to the EU. It coincided with the publishing of a new Fern report which finds that the Sustainable Cocoa Initiative has enabled dialogue between producer governments and the EU; has pushed forward national traceability systems; and helped prepare the ground for the EUDR. It also revealed challenges, from deficiencies in forest and child labour monitoring systems, to the lack of inclusive, frank dialogue between actors.

Presentations:

Participants heard that that in Côte d'Ivoire, civil society had not been sufficiently consulted as part of the cocoa dialogues and that there are challenges in implementing the proposed traceability system. These include the creation of the database (geolocalising all producers). Many farmers have not registered out of fear of having to pay taxes. Each company therefore has their own traceability system – but a national system would be more efficient for everyone – especially for cooperatives.

In Ghana, the government learned from companies’ systems and followed best practice. As only 20 per cent of farmers are registered, a national system could be beneficial. NGO monitoring is welcome, but the system should be funded by all cocoa actors. There is a need to look at the way funds are disbursed, as often it takes too long.

From the business perspective, the Sustainable Cocoa Initiative has been unique – multistakeholder talks were fruitful, and don’t happen in all sectors. The EUDR is coming, but there is still a divide between the EU and producer country narrative – this needs to be solved to make implementation smooth. Dialogues must continue, but the starting point should be in producer countries and we need to the Economic Pact. The Cocoa Talks model worked and should be applied to other raw materials, despite different dynamics (such as palm oil).

The Commission underlined the importance of trust between stakeholders – especially given the imbalance of power. Something has changed in the EU – consumers are making the connection between cocoa and deforestation, making it a reputational risk for companies. Chocolate companies will not want the same controversies as they experienced with palm oil. It is incredible to see NGOs and companies talking. We must accept that there is a margin of manoeuvre within the price of chocolate as the price of the commodity is only a fraction of the product being sold. EU companies are buying at a higher price now – so it proves they can pay a higher price. The Cocoa Dialogues is a best in class example in terms of preparation of the EUDR, giving cocoa a head start. The cocoa dialogue has changed cooperation with the countries on trade matters and allowed the discussion of sustainability issues within Economic Partnership Agreements (EPA).

This is a good example of sustainability discussions being advanced through coordination between the EU and the governments, but also between government departments in country. They are looking at how to use the EPA (which presently do not have sustainability chapters); discussing how to create a conducive environment for investment; and reflecting on how to use a new instrument such as a Sustainable Investment Facility Agreement (like the one signed with Angola) with all stakeholders involved.

From the European Parliament perspective, now is the time to get more involved in implementation. There have been information sessions in producer countries, but this is not enough. The question is how to use lessons from the Cocoa Dialogue.
 

Discussions:

These focussed on companies accessing national data; inter-ministerial coordination in the European Commission; lessons for other commodities; trade and sustainability, traceability systems and prices.

On national data, it was explained that the EUDR requires that companies be able to access the database. So if you buy from the Ghana Cocoa Board, for example, they will offer the necessary data as a service for traders. They will assess this on a case by case basis to ensure the request is genuine.

On coordination, it was agreed that the European Commission needs to consider how to deal with the fact that a lot of cocoa crosses frontiers, such as between Liberia and Côte d'Ivoire and Congo Brazzaville and Cameroon.

On learning lessons for other commodities, it was suggested that this could be useful for others like Brazil, on coffee, and it was explained that VOICE is launching a coffee network.

On traceability, there was a discussion on how confident we can be in national traceability systems, but the answer was not clear. There is willingness and we have seen it happen before, such as with legislation on food quality and safety. Some felt that the information is already collected and that companies now need to participate to create the national system. This is not like the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan because there is no licence, so there may be less incentive, but this could be something to reflect on – how to use this information in risk ratings. It was suggested that farmers need to register and have confidence in the system as it is based on data from the farmers’ census. It was stated that if prices are high enough, people will be less motivated to expand into forest areas, as they will have “enough” with their existing plantation area.

On prices, it was agreed that it is important to listen to producer countries about what they need – and that prices are the key issue. Prices are also an issue in Europe – they are too low - but we make up the difference with Common Agricultural Programme subsidies. The global commodity pricing system is broken – the EU needs to consider what it can do to help support more decent prices and guarantee a decent income for farmers. These matter to producer countries – if they saw that the EU was taking their central demand seriously, this would change the partnership, so that both sides are getting something out of it, and not one side telling the other side what to do.

Kategorien: Events, EU Regulation on deforestation-free products