Addis Abeba – The Ethiopian government has welcomed the recent decision by the European Council of Ministers to delay the enforcement of its stringent Deforestation-Free Regulation (EUDR) by one year, providing much-needed relief to the nation striving to meet compliance standards.
In an interview with the state-affiliated FBC, Girma Amente (PhD), the Minister of Agriculture, emphasized that the decision provides significant relief for nations like Ethiopia.
He noted that with less than three months remaining before the original implementation date, there were concerns about the potential negative impacts of the regulation.
Emphasizing the challenges faced by developing countries, the Ethiopian government had previously requested an extension for the enforcement of the EUDR, which was initially set to take effect on 30 December, 2024.
This apprehension arises from the fact that approximately 30% of Ethiopia’s annual coffee exports are destined for EU member states.
On 16 October, 2024, the European Council of Ministers endorsed the European Commission’s proposal to delay the implementation of the EUDR by one year.
The decision followed the European Commission’s proposal for a 12-month postponement.
“This postponement will allow third countries, member states, operators, and traders to be fully prepared for their due diligence obligations, which require ensuring that certain commodities and products sold in or exported from the EU are deforestation-free,” the European Council stated.
Upon approval by the European Parliament, large operators and traders are anticipated to comply with the regulation by December 2025, while micro- and small enterprises are expected to adhere to the requirements by June 2026.
The European Parliament is scheduled to vote on the Commission’s proposal during a plenary session on 13-14 November, 2024.
Industry stakeholders who have been vocal about the potential negative impacts of the EUDR on the Ethiopian coffee industry are pleased with the EU’s recent decision to extend the implementation period by one year.
In an interview with Addis Standard, Gizat Worku, General Manager of the Ethiopian Coffee Exporters Association, expressed optimism about the extension.
“I believe a year is sufficient time to prepare,” he stated. “This is because work was already underway prior to this decision. It has been in progress for two full years, so I am confident that one year is enough to complete the remaining tasks.”
Minister Girma revealed that a delegation from the European Forest Institute recently visited Ethiopia to assess whether coffee cultivation practices in the country align with the EU’s environmental criteria.
“Members of the delegation confirmed that coffee cultivation is not a driver of deforestation in Ethiopia,” he stated.
Despite this positive assessment, Minister Girma noted that the EU has insisted on the use of GPS technology to verify the origin and processing of coffee, ensuring full traceability throughout the production, processing, and distribution of Ethiopian coffee.
Enacted by the European Parliament and Council in June 2023, the EUDR seeks to reduce carbon emissions stemming from EU consumption and production of specified commodities by at least 32 million metric tons annually.
European lawmakers intend to achieve this objective by establishing a system that ensures the traceability of production, processing, and distribution of six agricultural products, including coffee, from exporting countries to the 27-member bloc.
The regulation outlines stringent criteria that must be met by exporters residing in developing countries like Ethiopia, with the primary task of verifying compliance among the vast number of small-scale farmers engaged in coffee cultivation.
This development presented significant challenges for the over six million farmers nationwide directly involved in coffee cultivation, as well as for the over ten million individuals engaged in the extensive coffee supply chain, spanning from farmers and intermediaries to exporters and end consumers.
Although Ethiopia acknowledges the positive aspects of the regulation, Girma disclosed that the government was concerned about the timeframe for compliance.
“The large number of individuals involved in the supply chain, along with existing financial constraints, have posed significant challenges in meeting the requirements,” he stated.
Alongside coffee-growing nations like Ethiopia, a consortium of major European coffee roasters and the head of the International Coffee Organization have urged for a delay in the enforcement of the regulatory measures, warning of the potential unintended consequences the law may bring.
They argue that substantial segments of the coffee-producing world may be excluded from future trade with Europe, resulting in devastating economic repercussions, particularly for the most vulnerable farming populations, who often have the least capacity to comply with the requirements.
A recent study conducted by the Overseas Development Institute (ODI) also underscored the potential negative impact of the EUDR on the economies of developing countries like Ethiopia.
Titled “Avoiding a ‘Green Squeeze’: Supporting Least Developed Countries in Navigating New Greening Trade Measures,” the study predicts that the EUDR will have substantial economic repercussions for Ethiopia.
According to ODI, a complete halt to exports to the European Union could result in a significant economic downturn in Ethiopia. Specifically, the country might experience an 18.4% decline in total exports, a 5.8% decrease in imports, a 3.3% loss in public revenue, and a 0.6% reduction in GDP.
The Minister of Agriculture stated that efforts are already underway to effectively utilize the one-year extension period to meet the EU deforestation regulation criteria. “We have begun identifying producers who supply coffee to the EU market, and the process of collecting the necessary data from them has commenced.”
He also mentioned that a trial coffee export to Germany will take place before the end of the extension period to ensure compliance with the regulation before it becomes effective.
“Ethiopia will comfortably comply with the regulation by the end of December 2025,” Minister Girma affirmed. AS
