Article published in the Jakarta Post

The European regulation to combat deforestation (EUDR) is an opportunity for Indonesia. This statement is not meant provocatively. I will attempt to prove that the Indonesian government can and must transform an annoying and costly European decree into an opportunity for not only economic and social but also geopolitical development. 

I do not want to convince Indonesia as the world’s palm oil producer and other suppliers that this regulation is useful, or that it does not harbor serious unintentional—or perhaps intentional—consequences, especially for small palm oil producers. Nor am I convinced that it is a good regulation, it certainly is not—and cannot—be perfect. 

The reasoning that urged Europe to undertake this regulation, which is only a small, but important, part of a more ambitious and visionary reform plan (the Green Deal) is, and remains, commendable. Unfortunately, the end-product is both debatable and problematic, and not just for you producer countries that export to Europe, but also for the 27 countries of the EU that import and which, in turn, must comply with the complexities of this regulation.

In addition, as is often the case, the European institutions took their usual top-down approach. They did not make the effort to communicate with and involve the producer countries whose contribution to the new legislation would have been fundamental. The frustration spreading through producer countries, not only in Southeast Asia, is therefore understandable and must be underscored in institutional discussions. The content of the regulation has not benefited from this unilateral approach. In fact, all the defects are emerging now that it is being implemented. 

However, we must look at it realistically and be pragmatic. Like it or not, the European choice is already a benchmark and many governments are preparing to implement similar regulations (for example, some states in the United States). The regulation is here to stay and will not be modified (there is neither the time nor opportunity, at least not until the next European legislature). 

The European institutions will not turn back. The dynamics of the EU, especially the commission, are such that there will be no change of mind. Those who wrote the regulation, and also those who voted for it, do not have a direct relationship with their electorate or the general public. 

However, the European institutions urgently needs to implement the regulation and show that it will be effective. To do this—and they are finally realizing this—they need producer countries. Without the agreement of producer countries, such as Indonesia, the goals of the regulation cannot be met. In other words, the EU dictated the rules without consulting with the producing countries first, but now the EU needs the producing countries to make sure they function.

This means that Indonesia has significant room for negotiation. And this is the opportunity. Which can be taken advantage of if, and only if, Indonesia shows interest in wanting to comply with the regulation whose true aims we all share—although not the instruments imposed by the EU to attain them. 

But Indonesian compliance involves difficulties we are well aware of. 

These difficulties must be transformed into requests for collaboration to be able to comply with the regulation. This means time and financial and technological resources, and small producers must be supported and reorganized so that they can adapt, redesign their logistics for traceability, and so on. It is an enormous challenge to which the EU must contribute, that is, collaborate with Indonesia as the world’s largest palm oil producer so that the regulation is a success.

They did not do this while the regulation was being drafted and approved, but they must do it now that they are working to implement it. No region, no raw material can be left out. Given this context, Indonesian shopping list must be paid by the EU. And it must include many requests. For example, in this phase, it is legitimate to request that the absurd use of the “palm oil free” label be ended, which for years has unjustly damaged the reputation of palm oil. 

With the new regulations, there is no reason for the “negative” labels to exist. The palm oil entering Europe now conforms to all regulations, which means it is safe, wholesome and sustainable. Anyone wanting to exclude it, claiming that it is harmful to health or the environment, is a fraud. The European market, so concerned about regulations to safeguard consumers and the planet, must free itself of frauds. 

I understand that what I am suggesting here is difficult to digest, especially because among the producing countries there is a perfectly understandable desire to retaliate against centuries of Western, and not just European, injustice. However, today, Indonesia is part of the Group of 20, one of the five most-populous countries (EU included) with many young people (unlike the West), and all economic and growth indicators rising exponentially. 

To paraphrase the famous image of a legendary French film of the last century, “the world is yours” (Le monde est à vous). To grasp it, you must adopt a pragmatic approach and take your place at the negotiating table to transform what seems to be unjust discrimination into a tremendous opportunity. 

Negotiating with Europe during the implementation phase of the EUDR is a development opportunity that will find you ready when, sooner or later, other governments will implement similar regulations.

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Image credits: courtesy of The Jakarta Post >>>