The Alliance for Sustainable Agriculture (ASA) of Costa Rica held its first seminar to analyze the European Green Deal and its potential implications for the Costa Rican sector. Erick Apuy, Director of Trade Intelligence at Procomer, was in charge of analyzing the set of policy initiatives and their impact on Costa Rican agriculture.

Apuy detailed that the European Green Deal was launched in 2019 and is a project that seeks for the European Union to reach carbon neutrality by 2050: "This agreement has a scope beyond its borders, with standards that must be met by countries wishing to enter or remain in this market."

In this sense, he pointed out that in 2023 the Central American country exported 37% of its agricultural production to the European Union, therefore, "it is of vital importance to adapt to the guidelines required by the Green Pact."

He emphasized that the Green Deal is not a regulation in itself, but a series of political initiatives, objectives, aspirations, and needs, which must be defined in a regulation to define how these objectives are to be achieved.

Costa Rica

Procomer's representative indicated that Costa Rica or any other country supplying food to the European Union, must understand that the Green Pact is a geopolitical strategy, which is fed by different strategies.

"Within the Green Deal, we come across strategies, one of them is the action for a circular economy, which seeks to stimulate an economy based on reuse, recycling, and minimizing the impacts of productive consumption."

He said that the regulation is in the first reading of the legislative process in the European Parliament, for its subsequent approval. Once approved and signed, it would enter into force 21 days after publication in the Official Journal, for subsequent implementation one year after publication.

"That means that, although it may enter into force, in the short to medium term there is still about 12 months for its effective application," said Apuy.

In this regard, he emphasized that it is important because all packaging, containers and certain materials that enter the market on their own or accompanied by agri-food products must meet certain compositional requirements and their materials must be suitable for recycling.

The industry must consider that as of January 2030 all packaging must be recyclable and its design will have to comply with criteria that facilitate its recycling, which implies that companies must approach their suppliers of packaging, containers, or packaging materials to understand their composition.

He added that a minimum content of recycled material must be met, for example, when the main component of the packaging is PET plastic, 30% will be required.

In terms of the design of packaging and/or containers, for example, it will be required that they be designed in such a way that they are specifically adjusted to the needs of the product, "because the aim is to avoid empty spaces which are sometimes filled for protection purposes, with air cushioning, plastic or foam bubbles."

The second strategy suggested by Apuy is 'from farm to table', which has some objectives such as halving the use of pesticides, reducing the loss of nutrients by at least 50%, reducing the use of fertilizers by at least 20%, and transitioning agricultural land to organic production.

"Within this strategy, there is a proposal for a regulation that was withdrawn in May and it is very likely that, even though it was withdrawn, the European Union will push for a new version of the regulation, probably a bit more flexible," he said.

Recommendations

Apuy recommended that companies map out their supply chain, identify all the elements involved in it, carry out a risk assessment, and understand the compliance of their operation for different productive areas, whether legal, tax, and/or labor. And, in the case of identifying risks, they should carry out a mitigation process.

"I believe that the Green Deal is much more than the environment, it implies a commercial and productive geopolitical rethinking with the European Union (...) It can inspire other markets and developed economies to seek similar standards. For example, the United States is exploring something similar to the regulation of deforestation-free products," he said

In this sense, he said that for agro-exporting countries, a part of their supply could be temporarily excluded from the European market for non-compliance in agrochemicals.

He indicated that, in general, Costa Rica has important challenges in terms of the use and consumption of agrochemicals, but also an opportunity, such as enhancing its supply of bio-controllers.

Among the recommendations made by Apuy, is that the industry should work on containers and packaging. "It is necessary to deepen local alliances for the development of biomaterials. In Costa Rica, 77% of the plastics sector offers some type of environmentally friendly plastic."

Finally, he pointed out that in the medium to long term, the European Union will probably be the largest organic market in the world, "so if we do not increase our organic supply, we will be increasingly relegated to segments that are more price-oriented and less value-added oriented."