Columnists

New EU rules risk Africa farm exports

farm

Flowers are grown in a greenhouse at a farm in Nakuru County. FILE PHOTO | NMG

As developing countries look into ways to address food security, the agricultural sector plays a critical role in supplying food and export earnings. But this might be further affected if the leaders in these countries do not take the newly established European Union (EU) regulations seriously.

The measures the European Commission unveiled seek to increase the contribution of EU trade agreements in safeguarding the climate, environment, and labour rights worldwide. It is part of the EU’s efforts to make trade greener, fairer and more sustainable.

The European Green Deal is focusing on the EU climate strategy to reach net zero emissions by 2050. It is a roadmap for a socioecological transition to a low-carbon future and it provides building blocks for a green economic strategy in Europe.

But what does this mean for the developing world? The changes will also have far-reaching implications in export countries like Kenya. Currently, Africa’s exports of agricultural produce to the EU and agri-food make up 16 percent of EU-Africa trade and are worth €5 billion ($19.6 billion).

In its latest economic data, the Kenya National Bureau of Statistics reported that horticulture profits increased from Sh150.2 billion in 2020 to Sh158.1 billion ($1.39 billion) in 2021. However, the upward trajectory is now under threat unless Kenya creates widespread awareness and builds the capacity to implement the rules.

Indeed, the requirements are not any different from what it is a businessperson must do to sustain a customer. The EU, our customer, proposes to incorporate into all its trade agreements sections on trade and sustainable development (TSD).

Even though the world anticipated these changes under the advancement of environmental, social and governance (ESG) initiatives, many countries are yet to prepare for them.

The UN Sustainable Development Goals (SDGs) also consider global trade as “an engine for inclusive economic growth and poverty reduction” and its means of implementation. SDGs approach to sustainability is by embracing ESG concerns in international trade.

The new approach to TSD leaves no room for mischief. They will ensure compliance through “results-oriented and priority-based engagement with partner countries”. They will further engage intermediaries such as civil society organisations to “lodge complaints on violations of sustainability commitments.”

And focus on implementation and enforcement with a “possibility to apply, as a last resort, trade sanctions for material breaches of the Paris Climate Agreement and the ILO fundamental labour principles.”

In the recent past, large corporations in Kenya have had their exports banned in Europe. And despite the action, compliance is still a challenge. Many Kenyan companies seem not to have taken ESG issues seriously.

Non-compliance at the small business and individual levels are worse than in listed firms. Therefore, I believe exporters and policymakers must voluntarily join hands to create more awareness and adhere to emerging global trade standards. There is also a need to understand the impact of ESG on out-growers since they are a critical cog in the global value chains.

Although the Paris Agreement is a far-removed concept from ordinary farmers, it is time they became part of the solution to global challenges for their survival. This accord lays out a worldwide framework to avoid severe climate change. And it is increasingly becoming relevant in our daily lives.

In its simplest explanation, the farmers must know what supports them to improve their capacity to produce, export and create more wealth collaboratively in a sustainable world.

These requirements may appear stringent, but governments have no choice but to respond to the dictates of what the customer wants, how they want it and when they want it. There is no room to manoeuvre but respond to customer needs.

It is in our interest to innovate around the changing global dynamics brought about by climate change. Developing countries’ competitiveness in growing food for export to the EU hinges on sustainable agriculture. This brings to bear the need for multilateralism in addressing these systemic issues.

Even simplifying emerging terminologies around climate change, policymakers must re-think the entire value chain and what it takes to put food on the table.

For example, transporting food from Africa to Europe will soon become a challenge because Europe looks at the miles food travels from source to the table. It is argued that long-distance food transportation by air, for example, is not recommended because it also produces a significant amount of carbon dioxide emissions.

Before the issue becomes another requirement, developing countries must explore other modes of transportation and new technologies to preserve perishables products transported by sea to their destination.

In addition, the change will require partnership with various value chain actors including governments as well as shipping companies, and the discipline to aggregate production to effectively utilize necessary resources to meet the customer needs.

These requirements may appear stringent, but governments have no choice but to respond to the dictates of what the customer wants, how they want it and when they want it. There is no room to manoeuvre but respond to customer needs.

It is in our interest to innovate around the changing global dynamics brought about by climate change. Developing countries competitiveness in growing food for export to the EU hinges on sustainable agriculture. This brings to bear the need for multilateralism in addressing these systemic issues.

The writer is Kenya’s Ambassador to Belgium, the European Union, Organization of African Caribbean and Pacific States and World Customs Organization. The article is written at a personal level