A Just Transition for Smallholders

MEPs have a crucial chance to ensure smallholders around the world don’t pay the price for EU efforts to end deforestation.

When the European Commission published its proposal for a Regulation on deforestation-free products in November 2021, it was hailed as a landmark in the fight against deforestation. 

The European Union (EU) set an example to the rest of the world by proposing a law to stop the products which drive deforestation around the world from entering their markets. 

Yet the Commission’s draft Regulation had a notable shortcoming: the related impact assessment did not thoroughly evaluate the specific needs of the smallholders who produce many of the goods the Regulation will target - or fully account for the challenges smallholders will face.

Now, however, the EU’s directly elected representatives have a vital chance to ensure that it does.  

This week the Regulation will move closer to becoming a reality when Members of the European Parliament (MEPs) vote in the European Parliament plenary: the Parliament’s last chance to determine its position on the law.

 

More support needed

Around five million mostly West African smallholders are responsible for producing 80 per cent of the globe’s cocoa. Almost two-thirds of global coffee production occurs on 12 million farms of less than five hectares. Around 30 per cent of global palm oil production results from the work of smallholders. All these crops drive deforestation and will be covered by the Regulation.  

Instead of adding to the burden many smallholders who produce these crops already face, the Regulation must see them as agents for positive change. 

Unfortunately, the Commission’s impact assessment of the Regulation did not adequately assess how the new law will impact smallholders, and the costs they’ll have to bear to comply. Smallholders face increased requirements to maintain access to global markets while being offered no financial or technical support or appropriate incentives to meet the latter.

This is why 50 organisations, including producer networks from around the world, wrote to the European Commission in June asking for it to carry out a specific study on what is needed to guarantee smallholders’ capacity to adapt to the proposed EU regulatory requirements.

The letter called for a “time-bound action plan” with “specific financial resources allocated to it”, so any support measures could be in place before the Regulation comes into force.

So far, the Commission has ignored this request for a new assessment, but responded by saying that they were “willing to do more” to increase their “understanding of the challenges faced by smallholders”.

 

Positive signs

But for the law to be truly effective and fulfil the hopes invested in it, namely reducing deforestation rates while securing the livelihoods of smallholders and local communities, there must be specific measures ensuring a just transition for smallholders towards sustainable, deforestation-free products that respects their rights and does not saddle them with extra burdens.

The message is getting through to some in the EU corridors of power.

Last July, the European Parliament’s Environment Committee voted on a draft position that was much more mindful of smallholders in terms of support and protection. 

MEPs will vote again to adopt the Parliament’s position in plenary and have the chance to preserve key elements that protect and support smallholders, Indigenous Peoples, forest communities and local communities. 

This will be a crucial step forward for the further negotiations between the European Commission, the Council and the Parliament. 

The EU bears a specific responsibility to avoid placing a disproportionate burden on farmers unable to bear it. Smallholders’ realities need to be brought to the centre stage in this legislative process. Not as an excuse to water down the proposal, but to provide objective data to stakeholders, including companies, on how they can, and should, help smallholders produce deforestation-free products.

 

This article was co-authored by Charlotte Vernier (Fair Trade Advocacy Office), Fanny Gauttier (Rainforest Alliance), Gert van der Bijl (Solidaridad), Jinke van Dam (Tropenbos International) and Indra van Gisbergen (Fern).