Brussels’ Green Ministers Head to Indonesia

  • The EU ‘Green Deal’ and Environment Commissioners travelled to Indonesia for the G20 meetings
  • Questions remain over Brussels’ deforestation regulation

The EU’s Environment Commissioner Virginijus Sinkevičius, travelled to Bali this past week for the Joint Environment and Climate Ministers’ Meeting, alongside Commission Vice President Frans Timmermans and Energy Commissioner Kadri Simson.

Brussels is attempting to finalise its trade agreement with Indonesia, as well as the first-ever EU-ASEAN Leaders’ Summit in December. At the same time, the EU is seeking greater maritime security cooperation with Indonesia.

The word ‘cooperation’ is used a lot in the EU’s language towards Indonesia, including on environment and sustainability matters.

The problem is that the Indonesian palm sector looks at the EU’s Deforestation Regulation, and sees the opposite of cooperation: namely, unilateral trade barriers.

This is a pattern recognisable to many developing nations in their dealings with Brussels: cooperation in public, but behind the scenes the EU machinery continues to push protectionist regulations and then presents it as a fait accompli. Judging by recent events, Indonesia is wise to this and is unlikely to play along.

There’s an additional elephant in the room: the timber sector. The Deforestation Regulation states that goods that are exported to the EU under the existing EU-Indonesian Voluntary Partnership Agreement will pass the regulation’s test for legality. So far, so good. However, the goods will now have to comply with additional requirements under the new Regulation that go beyond legality/VPA.

This is potentially a black eye for EU diplomacy on forests. Indonesia’s forest sector and its government officials have spent literally decades meeting the EU’s demands to implement a mutually-agreed forest legality system for exports. The Deforestation Regulation now undoes much of that work. Not very cooperative.

Calling on Indonesia to Wean Off Coal is, well, Rich

According to the EU Commission’s press team, Energy Commissioner Kadri Simson is taking a keen interest in Indonesia’s energy transition:

“Commissioner Simson will then travel to Balikpapan, East Kalimantan Province for a visit to a coal mining site. Coal contributes to one-third of the economy of the province, and Commissioner Simson will discuss with local stakeholders on Europe’s experience in clean energy transition. In Jakarta, Commissioner Simson will use the opportunity to meet with a range of interlocutors, including relevant Indonesian Ministers and the Secretary-General of ASEAN, as well as with representatives of the private sector, think tanks and civil society working on and interested in energy transition.

Given that Europe is currently re-starting coal plants in order to its own energy crisis, is this really the time to lecture others?

At the same time, the European Parliament recently voted to exclude palm oil by-products from the EU’s Sustainable Aviation Fuels regulation – just as Norway is seeking to expand oil and gas production to meet European demand.

Consider what this means: Norwegian fossil fuels are ok, but Indonesian palm oil is not; it’s ok for Europeans to re-start coal-fired energy, but it’s not ok for Indonesia.

There’s a simple description for this: hypocrisy.

Durian is the New Palm

  • Durian looks to be the next crop in line for the Western deforestation narrative – but can Europe take any action?

Multiple stories have emerged over the past few weeks covering increased demand for durian. There are two aspects to the stories. First, that demand is soaring. Second, that some farmers are switching to durian and that it may become a new source of deforestation.

It’s true that demand is up; the market for the fruit – particularly the Musang King variety – has skyrocketed in China. This has been enabled by new trade arrangements between exporting countries (principally Thailand and Malaysia) and China under the RCEP agreement.  

And certainly, this high demand has prompted some farmers to plant additional hectares of durian. The claim that durian is causing a new wave of deforestation, however, is yet to be tested.

But there’s a problem.

Ultimately, the sellers (farmers) and high-volume buyers (China) operate in a very closed loop. Unlike palm oil, rubber or coffee, there is virtually no demand for durian in Western countries, whether fresh or processed. It’s not used as an ingredient in other products.

And, let’s be frank: the Chinese market has almost no regard for deforestation.

If durian growing is a contributor to deforestation, what will Western policymakers end up doing?

Our answer: precisely nothing. Unlike palm oil, there is no competitor for durian in Western markets, which means the EU does not need to regulate to protect European farmers. Will Brussels stand on principle and target durian anyway? Er, no. Environmental regulation seems, coincidentally, to focus on crops that compete with European farmers … and those crops that don’t are mostly left alone.

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