The Joint Task Force (JTF) meeting that took place earlier this month represented a significant moment in the debate around the EU Deforestation Regulation (EUDR) and palm oil more broadly.
The meeting was a preliminary one, which means that it for the most part dealt with the functioning of the JTF going forward and setting the terms of reference (TORs) – which were finalised at the meeting.
The TORs indicate it will function as long as the implementation process for the EUDR takes place. At this stage it means that it will be in operation until the end of 2024.
Indonesia’s government and its commodity sectors – palm oil, as well as many others – have made it clear that there is a lot at stake for Indonesia’s economy, upwards of USD6 billion in exports.
The TORs for the JTF address EUDR implementation and benchmarking, data sharing, certification, practical and technical approaches, cross commodity learning and capability ‘enhancement’ – with an emphasis on smallholders.
Expectations are that the JTF will ultimately be able to smooth the EUDR implementation process and help ensure it disrupts trade as little as possible. Achieving this will require a serious commitment from the European Union in terms of transparency, communication and even capacity building.
There are ongoing concerns, however, that Brussels has neither the flexibility nor the interest in meeting these objectives. The major concern is that the European Commission is simply using the JTF as a form of ‘training’ or outreach that fulfils elements of the EUDR itself.
The Government of Indonesia has made it clear at numerous points that it is seeking to come to an understanding on certification, particularly for smallholders. ISPO, Indonesia’s national certification scheme, is the most obvious tool for this. The ideal in this scenario is that the EU effectively ‘endorse’ ISPO as a compliance tool for smallholder exporters; and/or the European Commission advocates for ISPO and other national schemes in its implementation guidelines. Alongside that, capacity building for ISPO implementation is key.
In addition, Indonesia is determined not to be labelled as ‘high risk’ under the EU’s benchmarking system. The key element here is that Indonesia has reduced its deforestation rates significantly. This week the Guardian analysed research from Global Forest Watch (GFW) and the World Resources Institute (WRI) on Indonesia’s success in reducing deforestation. The report highlighted that Indonesia has reduced its primary forest loss by 64 per cent since 2020, leading the world in terms of reducing deforestation.
This new and credible research – and other research like it — is a critical element for both the JTF and must inform the EU’s benchmarking methodology.
Again, a concern within the palm oil community and among Indonesian officials is that the EU is simply treating the JTF as a formality, and that it has already made its decision on how to approach Indonesia and the palm oil sector.
The next steps for Indonesia’s palm oil sector and the government are clear.
First, the sector must ensure that relevant and clear data on palm and deforestation is communicated to EU officials, as well as local and international media.
Second, communication on ISPO to officials must take place. In addition to this, it outreach for businesses on how ISPO assists in compliance with imports is vital.
Third, it is vital that the JTF – and Indonesia’s other negotiations with the EU – are understood to be part of a larger relationship. The European Union will make further attempts to narrow discussion on the JTF, prevent the EUDR from being discussed in other negotiations and defer harder decisions on EUDR implementation.
However, the EUDR is coming to define the EU-Indonesia relationship and it is critical that, if Brussels wants to maintain its political and economic engagement with Jakarta, it takes Indonesia’s concerns seriously.