“The reality is that the FTA between the European Union and Mercosur will cause a significant increase in global emissions of greenhouse gases.
Although to our knowledge a full audit on the climate impact of the agreement has not been provided, GRAIN calculated emissions from the agricultural sector, analyzing the provisions of the agreement that establish quantitative targets for increased trade in several important agricultural products.
The image of flames raging through the Amazon in August 2019 made people around the world realize the connection between agribusiness and the climate crisis. The forest was being burned to make way for the production of meat, soybeans and other agricultural raw materials and thus increase the profits of transnational food corporations. A major driver of this devastation is trade. Currently, a new trade agreement threatens to further increase the expansion of agribusiness in Brazil, with serious consequences for the climate.
Just two months before the fires that captured the world's attention, the European Union and the group of Mercosur countries - Argentina, Brazil, Paraguay and Uruguay - proudly announced that a new free trade agreement (FTA ), after twenty years of conversations. The agreement was touted as a 21st century pact, which would push member countries towards higher environmental standards, including strong limits on logging and deforestation. The European Union even boasted that Brazil's new president, Jair Bolsonaro, had reneged on his campaign promise to withdraw from the Paris climate agreement,[ 1]in order to achieve this commercial agreement.
The carbon footprint of the European Union-Mercosur FTA
The reality is that the FTA between the European Union and Mercosur will cause a significant increase in global emissions of greenhouse gases. Although a full audit on the climate impact of the agreement has not been provided to our knowledge, GRAIN calculated emissions from the agricultural sector, analyzing the provisions of the agreement that set quantitative targets for increased trade in several important agricultural products. We estimate that these commitments alone will generate about 9 million tons of additional greenhouse gas emissions per year. This is almost as much as the total annual emissions of the Brazilian city of Belo Horizonte, with a population of 3 million 900 thousand people.[ 2]
The new EU-Mercosur FTA is described as an agreement in which Europe will sell more cars and cheeses to Latin America while the Mercosur countries will sell Europe more beef and ethanol. While it is true that increased production and exports of automobiles and other goods and services will clearly contribute to altering the climate, our analysis focuses only on agriculture, a major component of the agreement. We analyze the changes in the volume of the markets of various agricultural goods that produce a high emission of greenhouse gases. The expansion of supply corresponds to what governments on both sides of the Atlantic promised their farmers and those who defended the interests of agribusiness when they negotiated the agreement. Whether these promises will be kept, or even surpassed, remains to be seen.
The commodities for which we measure the impact are: beef, cheese, ethanol (from sugar cane), infant formula, chickens, rice, skim milk powder and sugar. Butter and soy products were excluded from the calculations because, although their tariffs will drop significantly under the agreement, no quotas were set. In other words, production and trade in these products will likely increase as a result of the agreement, but we cannot say by how much. The figures obtained would be higher if they were included, since soybeans in particular are a large source of adverse emissions for the climate.[ 3]
We estimate that the direct impact of NAFTA will be an increase in greenhouse gas emissions of 8 million 700 thousand tons per year, from these eight agricultural products(See Annex). That is more than the city of Lisbon, Portugal, or Córdoba, Argentina and a little less than Brussels[ 4]. Put another way, it is equivalent to almost a week of emissions produced by Royal Dutch Shell, a company responsible for 3% of the energy of the entire planet [ 5]. Compared to the current level of emissions from trade in these products between the European Union and Mercosur, the increase in emissions will be 34%. This is a huge increase for governments that, in Europe at least, claim to be climate advocates.
How did we get these figures?
The increase in trade was calculated by comparing the new and old quotas (or with current levels of trade where there were no quotas) once the NAFTA transition period is complete. For increased emissions, we assume that increased trade will be achieved with increased production[ 6]. The emissions themselves were calculated for the current level of trade and compared with those produced under the new quotas, using the United Nations GLEAM methodology. This includes all emissions from livestock production, feed grains and associated inputs, meat processing and refrigeration, and transportation to public sale, but not including emissions during and after sale to the public. for sale that come from home preparation, food waste, etc.[ 7].
The agricultural products with the greatest climatic impact are meat, poultry and ethanol, which come from Mercosur, and cheeses from Europe. Two-thirds of the new emissions will be produced on farms, including fertilizers and manure, while about 30% will come from changes in land use, including deforestation. While most of the incentive to increase production and trade will come from quotas and tariffs, NAFTA also imposes rules on appellations of origin, which will create new market rights for European cheese producers in Latin America. Finally, it is important to note that although Mercosur will generate most of these new emissions, emissions from the growth of dairy exports from the European Union to Mercosur will increase by an incredible 497%.
Other environmental, social and economic impacts
In addition to aggravating the climate crisis, the agricultural provisions of the European Union-Mercosur FTA pose other threats. For example, as noted by the French sugar industry, 74% of the pesticides used in Brazil's sugarcane fields are banned in Europe, and Brazil has recently approved a genetically modified variety of sugarcane that is banned in Europe.[ 8]. The Brazilian government also allows the use of glyphosate before harvest to speed up ripening, while many cities and countries in Europe are fighting to ban glyphosate. [ 9]. This means that unwanted GMOs and agrochemicals are likely to enter Europe under this agreement.
In addition, the agreement allows the expansion of markets for agribusiness products and does not contribute anything to support small farmers or food production. In fact, the opening of markets for exports from Latin America is expected to result in increased pressure on indigenous and peasant communities that are being evicted from their lands. Another effect may be the increase in disputes over water due to the demand for irrigation and cattle raising, and even more due to deforestation and loss of biodiversity.[ 10]. In Europe, this trade agreement will help agribusiness interests while harming small farmers, rural communities and sustainable agriculture. In a region where investments and economic development promoted by free trade agreements benefit only large companies, the European Union-Mercosur agreement is expected to trigger the fall in prices for producers, deepening the debt and bankruptcy that it is already hitting rural areas of Europe.
The trade agreement also masks a serious contradiction. Increased imports of ethanol from the European Union through NAFTA are expected to be used to meet Europe's “green” transportation fuel use targets. The same can happen when the European Union increases its imports of cheaper soy products, which could be an attractive raw material for Europe's biodiesel industry. According to the organization Transport & Environment, this could lead to further deforestation and land grabbing in countries like Brazil.[ 11] European Union governments could end up causing further climate destruction abroad in order to achieve their climate goals at home.
Let's fight Free Trade Agreements to save the climate
Trade agreements are powerful drivers of the expansion of the industrial food production system, which, according to the International Panel on Climate Change, indicates that it is responsible for up to 37% of global greenhouse gas emissions [ 12]. Lobbyists for the different sectors involved, from the seed sector to the supermarket sector, have been pressuring governments to sign and implement these pacts for decades. They give food and produce companies, and the farmers who supply them, larger markets and investment rights - an opportunity to make higher profits. In turn, the expansion of the industrial food production system creates enormous pressure on our climate [ 13]
With the food production system contributing so significantly to the climate crisis, continuing to do more of the same is simply not an option. Unfortunately, the new business deals reflect old ways of thinking - precisely the way of thinking that is primarily responsible for the crisis. The European Union-Mercosur FTA is not an isolated case. Industrial agriculture is also important in the US-China negotiations, which Trump says will double US agricultural exports to China[ 14] And the upcoming EU-Australia-New Zealand agreement will likely increase European imports of beef and dairy with increases in the intensity of CO2 emissions.[ 15]
If we are really serious about reducing greenhouse gas emissions, we need to take effective action around the main global mechanisms that promote the expansion of industrial food production and agriculture - and trade agreements are leading the way. list. CEOs of companies like Danone and JBS are aware of the challenge, as their own business models are at stake - which produce these climate emissions and depend on this trading system.[ 16]. But the "care" will not come from compensation for destruction, as these companies promote. This must come from opening up space for local community-controlled food production systems to participate. This means handing over resources and leadership to farmers, regional processors, short commercial circuits and local markets. For this to be achieved, we urgently need to halt new trade agreements such as the European Union-Mercosur.
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