Will European trade undermine the EU’s move to clean biofuels?

The EU is negotiating trade deals with Mercosur (Argentina, Brazil, Paraguay and Uruguay), Indonesia, and soon Malaysia, These trade deals represent a risk for the EU’s sustainable transport plans. All mentioned countries are producers and exporters of crop-based biofuels, especially from palm and soybean oil that have higher overall emissions than fossil diesel. All ongoing negotiations include chapters on energy and raw materials.

One of the objectives of the planned trade agreements is to facilitate trade in these areas, which will reduce the cost of raw materials and biofuels originating from the abovementioned countries. At the same time the EU is committed to decarbonising the transport sector and to phasing out crop-based biofuels. There is a risk that these two approaches – the planned trade agreements and the EU's goals – will be at odds with each other. This report recommends four trade policy approaches to ensure that trade does not contribute to the use of unsustainable crop-based biofuels.