Climate negotiators meeting in Bangkok this week in preparation for the Copenhagen climate summit in December seem no closer to an agreement on how best to balance economic growth and protection of the environment.
One obstacle comes from Europe, where an alliance of green NGOs, industry and policymakers has targeted Asia’s palm oil industry as a global villain and is threatening a trade war. These critics are wrong on the economics and the ecology.
In June, the European Council issued guidelines on the Renewable Energy Directive, which was adopted in December 2008. Its purpose is to encourage European consumers to use greener, sustainable sources of energy, such as biofuels. This is a fine idea in principle. But as it turns out, the directive is a trade wolf in green sheep’s clothing.
Europe is one of the world’s leading producers of biofuels, mostly made from rapeseed oil. It accounts for two-thirds of the global market, with Germany as one of the largest producers.
Asian producers are increasingly important players in the global biofuels trade. Asian biofuels are a byproduct of palm oil, a sustainable vegetable oil and food staple for which demand is rapidly growing in Asia. Palm oil biofuel cannot be produced in quantities that will rival oil-based fuels, but it is cheaper than rapeseed.
So, in predictable fashion, Europe’s agricultural industries are defaulting to their traditional practice when a cheaper and better product becomes available to European consumers. They have inserted trade barriers in the Renewable Energy Directive to restrict imports of biofuel. And, as usual, they are pretending that the barriers serve another purpose — in this case preserving forest biodiversity.
This joins the protectionist play to a broader campaign to discredit palm oil. European policy-makers echo arguments made by Western environmental NGOs that biofuels from Asia are environmentally troublesome because palm oil plantations reduce forest biodiversity.
These claims do not withstand scrutiny. Forest biodiversity is achieved by reserving areas of natural forest. The Worldwide Fund for Nature says that around 10 percent of the world’s forests needs to be conserved to achieve this goal. More than half of Malaysia’s land and one quarter of Indonesia’s, the two largest oil palm producers, are already set aside.
Conversely, the WWF target in forest preservation has not been reached in most of the European Union. In Germany, land reserved to conserve natural forest is just 4 percent. Where are the demands to restrict E.U. trade to protect Europe’s forest biodiversity?
Furthermore, Asian biofuel is significantly more sustainable than European biofuel. It also uses much less land to produce the same amount of energy and generates 10 times as much energy as is required to produce it. By contrast, biofuels produced from European rapeseed generate only four times as much energy relative to the input.
Despite this, European biofuel producers and environmental NGOs are pressuring the E.U. to increase the trade coercion in the Renewable Energy Directive by restricting imports if something called “Indirect Land Use Change” occurs when they are produced.
Let me be plain about what this means. The conversion of forest land to produce higher value products like palm oil, cocoa or rubber is the leading means of reducing poverty in most developing countries. The idea being toyed with in Brussels is to use the threat of trade sanctions to pressure countries into giving up the leading anti-poverty tool.
Research from the Stern Review showed that the economic benefit to poor countries of growing palm oil vastly exceeded the value of any other use of the land. The World Bank, for example, found that developing palm oil was one of the most effective ways of reducing poverty in Indonesia. In Malaysia, palm oil was developed to create livelihoods for poor, landless workers.
Asian governments and businesses are not asking for much — simply the chance to develop their natural resources as Europe did for hundreds of years.
There is a historical tendency in Europe to seek to mold others in its image. This was part of what some styled the “white man’s burden” during the colonial era. Has this tendency reasserted itself as the Green man’s burden?
Lim Keng Yaik was Malaysian minister of primary industries, 1986-2004, and a founder of the Cairns Group of agricultural exporters. Source : The New York Times by Lim Keng Yaik