Government fears that new EU environmental rules may reduce Brazilian exports

The new European Union (EU) environmental rules to bar the purchase of goods produced in deforested areas come into force next Thursday (29). Although there is an 18-month transition period, the measure is seen with concern by the Lula government and by productive sectors, who fear a decline in exports.

The lack of clarity regarding how some conditions will be implemented has caused Brazilian representatives to project a possible increase in costs as a potential obstacle to the sale of Brazilian products to the bloc.

“It’s not enough that you comply with European legislation, there is a cost to prove that you comply with legislation, and this is an aspect that needs to be taken into account”, emphasizes Tatiana Prazeres, foreign trade secretary at the Ministry of Development, Industry, Commerce and Services.

The following chart shows the total quantity of TEUs exported from Brazil to the EU in the first four months of the year from 2019 to 2023. The information displayed below was gathered from the maritime intelligence service DataLiner.

Exports to the EU between Jan-Apr | 2019 – 2023 | TEU

Source: DataLiner (click here to request a demo)

The norm makes it mandatory for importing companies headquartered in the bloc to implement due diligence systems to monitor supply chains and mitigate any negative impacts of the foreign goods they buy. The products affected by the new legislation are cattle, cocoa, coffee, palm oil, soy, rubber, wood, and derivatives.

Source: Folha de S. Paulo

To read the original news source, see: https://www1.folha.uol.com.br/internacional/en/business/2023/06/government-fears-that-new-eu-environmental-rules-may-reduce-brazilian-exports.shtml

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