The Impact on Exports (INTAL-IDB). May 2024 

The main findings of the study are summarized below:

1. Recommendations for Operational Compliance with the Regulation

For commodities and products intended for export to the European Union, traceability systems will be required from the farm level through to the point of shipment. To achieve this, it is essential to identify all existing information systems—both public and private—across the relevant value chains and to further assess the compatibility of information provided by Argentina’s tax authority (AFIP) and the National Food Safety and Quality Service (SENASA) with the data requirements established by EU regulations.

In this regard, the study highlights the ViSeC initiative, promoted by the private sector for the soybean value chain. Export product traceability systems should incorporate the following elements:

• Integration of georeferencing systems: Geolocation data for plots and production units will be a mandatory component of due diligence requirements. Existing government databases should therefore be reviewed and integrated wherever possible. 
• In this sense, it would be desirable to have integrated information systems that provide data on production units and deforested plots. Considering the existence of CIAM, SiNiA, and SNMBN (mentioned in Section 2), it is recommended to build a platform that would allow users to enter a set of coordinates and access information at different levels or layers (for example, the provincial OTBN category corresponding to the plot, whether it has undergone deforestation after December 31, 2020, whether a management plan has been submitted, who owns the land, etc.). 
• It is therefore also advisable to create a georeferenced rural property registry, following the model of Brazil’s Rural Environmental Registry (CAR), for example. CAR is a mandatory national electronic public registry for all rural properties that integrates information on agricultural establishments with environmental information. 

2. Recommendations Aimed at Strengthening National and Subnational Institutional Capacity

The potential impacts of European regulation require an assessment of institutional capacities at both the national and subnational levels.

• Land-use planning. It is necessary to move forward with comprehensive territorial planning that jointly considers different biomes (forests, wetlands, etc.) and organizes agricultural areas, conservation areas, forest areas, and urban areas through environmental impact assessments and strategic environmental evaluations based on a federal agreement involving the private sector, civil society, local communities, and Indigenous peoples.
• Strengthening monitoring and enforcement mechanisms. Argentina ranked among the ten countries with the highest net forest area loss during the 2000–2015 period (Ritchie and Roser, 2021), highlighting the need to advance the development of stronger deforestation monitoring and enforcement mechanisms. This will require strengthening local information systems.
• Awareness-raising and training for provincial authorities. Provide training on the implications of granting land-clearing permits in green zones and how such decisions may affect future trade opportunities with the EU.
• Promotion and development of economic instruments. It is necessary to advance the design of more and better incentives for avoiding deforestation, including payment schemes for ecosystem services aimed at forest landholders.
• Likewise, it is important to promote the development of “green” banking aimed at financing projects that support environmental sustainability, specifically projects related to the technologies needed to guarantee the traceability and verification of products exported to the EU and subject to the Deforestation-Free Products Regulation.
• With regard to state capacities linked to environmental trade regulation, it is necessary to strengthen coordination around a common national strategy that addresses environmental, climate, trade, and sectoral dimensions in an integrated manner. In this regard, several possible guidelines emerge: 1) Recognition of institutional progress. It would be desirable that, in the dialogue with the EU regarding risk-level determination, due consideration be given to the progress achieved in strengthening protection mechanisms (the Forest Law, the expansion of forest management and conservation plans, and the development of instruments for forest monitoring and control). 2) Public-private approach to the issue as part of the National Climate Change Cabinet’s agenda. 3) Monitoring the regulatory implementation process. Special attention should be paid to the possible extension of the regulation’s scope to additional commodities and products (such as corn or biofuels), as well as to other ecosystems and lands with high carbon stocks and biodiversity value (grasslands, peatlands, and wetlands), as noted by the EU regulation.

3. Strengthening the Public-Private Agenda

• Building on the progress of existing initiatives (such as ViSeC), as well as lessons learned from previous experiences (forestry, biodiesel, Hilton Quota), and integrating them with key government agencies through a common working platform (Ministry of Economy, Secretariat of Agriculture, Ministry of Environment, AFIP, SENASA, Ministry of Foreign Affairs, among others).
• Strengthening existing networks to continue promoting sustainable agricultural production practices through support mechanisms and incentives for their adoption.
• Awareness-raising and training for agricultural production units (especially smaller ones). Providing education on the implications of land clearing in green zones and its potential impact on future trade opportunities with the European Union.

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