EU Deforestation Regulation must not imperil Vietnam's coffee farmers' livelihoods

15 December 2022

Written by: Vu Thi Bich Hop

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EU Deforestation Regulation must not imperil Vietnam's coffee farmers' livelihoods

The already precarious livelihoods of coffee farmers in Vietnam must not be pushed closer to the edge by the EU Deforestation Regulation, says Vu Thi Bich Hop, from the Center for Sustainable Rural Development (SRD).

There is little doubt that Vietnam’s civil society, as well as others who have been working to protect our country’s forests for many years, would generally support the idea of an EU Regulation on deforestation-free products (EUDR) – if they knew about it.  

Civil society would support the EUDR, because it reinforces the due diligence work on deforestation we’ve been doing through the Voluntary Partnership Agreement (VPA) timber trade deal Vietnam signed with the EU in 2018 – extending the commodities beyond timber to coffee, rubber and other drivers of deforestation.

Vietnam’s Government, as I understand it, is also generally supportive of the EUDR.

Yet, there are a number of issues around it that need addressing.

Principal among them is the widespread lack of awareness, both among authorities and those who it will affect. From our perspective it looks like the EU has not taken the time to properly consult producer nations.

We are particularly concerned about the EUDR’s potential impact on smallholder farmers and forest dependent communities.

These are the groups we work with: vulnerable communities including ethnic minorities, women and children, who live near forests. Ethnic minority coffee farmers in the northwest of Vietnam - who are among the few with any knowledge of it - have told us they are worried about the EUDR. The main reason is that both they - and the local authorities - do not know what it entails.

In these areas farmers encroach into forests incrementally. This is because farmers are given forest areas and they change them into coffee plantations: consequently our forests in these areas are being gradually lost, along with their biodiversity, which is worsening climate change, reducing water resources and creating other negative impacts.

Raise awareness

So, we have to provide capacity-building for the farmers and local agencies to raise awareness among them. Because the local forest protection staff don’t know about the EUDR’s requirements either. They are aware of issues related to water and deforestation, but ethnic minority farmers are very poor, so having opportunities to get increasing income and livelihoods are considered priority.

Small farmers in Vietnam work hard. Their work is physical, and they mostly work on the hills, moving around by foot and carrying equipment, fertiliser, food and water on their shoulders. Yet they earn very little.

In Vietnam, the coffee supply chain mainly relies on small farmers, especially in the northwest.

The main problem is that the farmers do not know about the supply chains they feed. They often do not even know the price of coffee.

When we’ve asked them if they know where the coffee beans they produce go, and which companies buy them, all they know is that there is a middle trader in the village who sets the price, over which they have no control. That is how it works.

In every village there is often an intermediary, then there is another one at local level, then another one at district level, and so on. Only then, there is the packaging and selling of the product. This shows how long, complicated and fragmented Vietnam’s coffee supply chain is.

We haven’t been able to conduct an analysis of the whole supply chain yet but through the work we do directly with farmers communities we know that their margins are very little, while the traders’ ones are larger.

So, we have to talk with other stakeholders engaged in the supply chain.

We have to make sure that not only the farmers are aware of the EUDR, but the other actors as well.

The Vietnam Coffee-Cocoa Association (VICOFA), for example, is not aware of the EUDR. They say that they ‘received an email from Europe’, but they don't speak English, so they don't understand what it is. Other than that, they only prioritise companies that export coffee.

This is the reason why we need to organise supply chain meetings and work out a mechanism to make sure that our target groups can comply with any requirements, and ultimately benefit from a shorter and more equitable supply chain.

For us, it looks like the EU did not take time to do proper consultations with producer countries. The lack of consultation with stakeholders, in particular small farmers, could lead to the EUDR not achieving its aims.

To start with, we would really like to have the funding and technical support to analyse the coffee supply chain in the northwest. That will help assess the potential impact of the EUDR on smallholder farmers. Only then we could have a better idea of how it could impact positively (or negatively) the farmers and come back with suggestions for the next steps in our country.

Complementary processes

We are working both on the VPA and the EU-Vietnam Free Trade Agreement (EVFTA) and now the EUDR as well.

I think all these processes are interlinked. They should not be conflicting, but complementary. VPA focuses on timber, while the EUDR concerns deforestation-free products in general.

In the EVFTA, Chapter 13 focuses on labour and human rights, biodiversity, and climate change. So, the EVFTA is broader, but still vague. I think the due diligence in the EUDR will be stricter. That is certainly positive, and we will continue to work on all three processes. I am sure the VPA will continue and FLEGT licenses will be issued in Vietnam and the EUDR will be applied as well, there are no other ways. In the EU market, nearly 40 per cent of the coffee is imported from Vietnam.

VPAs should be considered as milestones in terms of stakeholders’ consultations, both during the negotiation process and the preparation time.

My message to the EU would be that we support both VPAs and the EUDR. We would like the EU to continue to support Vietnam and to follow the stakeholder consultation, where voices from civil society, which represents small farmers, marginalised communities, ethnic minorities, women, and children can be heard.

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