The European Union’s largest political party is walking back its commitment to the EUDR…with a spokesperson for the European People’s Party (or EPP) dubbing the new regulation a “bureaucratic monster” – blaming “the greens, socialists, leftists and…French Liberals.”
That is, according to Peter Liese, the EPP’s German environmental spokesperson, who said the EUDR negotiations were a trainwreck: “If we [the EPP] hadn’t participated in the negotiations, the EUDR would be even worse,” he told Euractiv, a pan-European agency focusing on EU politics.
The centre-right EPP is Europe’s biggest single party, holding 169 (out of 705) seats in the European Parliament, 11 (out of 27) in the European Council and Commission, and 1,687 (out of 6,312) and 463 (out of 1,498) seats in the Lower and Upper Houses.
And despite the EPP supporting the EUDR in both the European Parliament and Council (with just 44 members opposing and 43 abstaining), Mr Liese said that the April 2023 vote occurred at “a different time” when “a majority” was pushing for a more ambitious Green Deal.
The EU’s support for an “ambitious” Green Deal has changed
For this reason, Mr Liese decided not to participate in the EUDR vote, as he did not want to vote against the group’s position: “I didn’t want to oppose it [the regulation] because everybody agrees that we need to stop deforestation,” Mr Liese said, with the rules negatively affecting small and medium-sized companies, including roasters and foresters.
“We need to keep the legislation. I’m not in favour of abolishing it, but we need to modify it,” he stressed. The EUDR has come under fire over the past months, particularly from agricultural ministers, who fear it will impose an additional burden on the bloc’s farmers and traders in the affected commodities.
Additionally, the Commission has yet to present the operator guidelines, expected by spring, generating uncertainty among the EU’s private sector and the bloc’s trade partners. The new obligations will apply to SMEs from January 2025 and by July 2025.
EUDR has united the United States and China!
Yesterday, Wood Central reported that China, the world’s largest forest economy, and the United States, the largest producer of forest products, both oppose the regulations, described as a “non-tariff trade barrier.”
Their discontent comes after twenty (out of 27) European Agricultural Ministers called for rules to be delayed amid concerns over global supply chains, echoing warnings from government officials in Australia, New Zealand, Brazil, Indonesia and Malaysia.
Last month, Wood Central reported that more than 6 million tonnes of pulp are imported into the European Union every year, with fears that the paper and board industries are amongst the most exposed and unprepared for the EUDR, leading to massive supply shortages and price hikes in European supply chains.
As a result, a large share of trade could be traded through Asia instead, “leading to an unintended increase in the use of high-deforestation-risk pulp and paper outside Europe.”
The result is a surge in compliance costs, which S&P Global forecast could balloon to US $2.5 billion as global forest producers drown in red and green tape. For its measure, the EU anticipates the cost “will need to be absorbed by a reduction of profit by operators along the value chain and eventually passed through to the final consumer.”
- For more information, visit Wood Central’s special feature on EUDR and its implications for the global supply chain of forest products from July 2023.
