MATS aims to identify key leverage points for changes in agricultural trade policy that foster the positive and reduce the negative impacts of trade on sustainable development and human rights
Particular attention is paid to SDG1 No Poverty, SDG2 Zero Hunger and SDG3 Good Health and Well-being, as well as SDG6 Clean Water, SDG13 Climate Action and SDG15 Life on Land.
Focus is on improving the governance, design and implementation of trade practices, regimes and policies at national, EU, African and global levels. In implementation, MATS develops and pilots new tools for a systemic analysis, and assessment, of the interactions between agricultural trade, investments, sustainability and development.
MATS ambitions
MATS has the ambition to set a new benchmark in trade policy analysis. It not only conducts orthodox quantitative analysis to identify major trends in international trade relations and their general effects, but also identifies impacts that trade agreements have by co-creating and applying new participatory tools and methods in trade-related analyses.
MATS seeks to transcend previous quantitative, econometric and model-based analyses. Inter-disciplinary in approach, MATS combines analyses from agricultural economics, sustainable development research, and trade and market modelling with research on institutional, regulatory and legal frame-works to broaden and deepen earlier analyses and make policy recommendations. The project partners aim to inform relevant debates and policy developments based on this diverse portfolio of perspectives.
MATS wants to contribute to the development of a fair trade system that supports local development and promote labour and human rights on a global level. International and national food security regulations are considered in studying the relationship between possible conflicts amongst diverging policy objectives, measures and subsidies, and their respective impact on climate mitigation efforts and the economic development of poor countries.
The Horizon 2020 MATS project: Background & Key insights
How could we make agricultural trade more sustainable – in a triple-bottom-line sense – by focusing on the sustainability implications of trade policies and related instruments?In the following pages, you will find answers via a summary of the approach and key findings from a 3.5-year research project (2021-24), funded by the European Union’s Horizon 2020 research and innovation programme, called “MATS” (Making Agricultural Trade Sustainable).
The MATS project aimed to identify key leverage points for changes in agricultural trade policy that foster the positive and reduce the negative impacts of agricultural trade on sustainable development and human rights. The MATS consortium consisted of 14 partners (https://sustainable-agri-trade.eu/our-partners/) that delivered on three levels (Figure 1):
- A multi-method analysis: An assessment of linkages between agricultural markets, trade and investments; a set of 15 in-depth country, regional and product-based case studies that provide a deeper understanding of the conditions for sustainable trade as part of an integrated multi-model-based analysis framework that relates micro- and macro-levels, integrated with an analysis of institutional, regulatory and legal frameworks.
- Exploration of pathways towards sustainable trade: A multi-stakeholder forecasting and backcasting approach to explore transition pathways towards sustainable trade.
- Consultations with global value chain stakeholders and policy dialogue for policy recommendations: Collaboration with sector representatives, social movements, policymakers (https://sustainable-agri-trade.eu/our-events/) and other trade-related research projects with DG Agri as part of clustering meetings, and through collaboration with related research projects such as Trade4SD (https://www.trade4sd.eu/) and VCA4D (https://capacity4dev.europa.eu/projects/value-chain-analysis-for-development-vca4d_en).
Executive summary (Bodo Steiner)
Science-based institutionalised sustainability impact assessment and stakeholder inclusiveness could be considered central parts of a rules-based governance vision of global agri-food value chains that are connected through trade. Yet, in a time of poly-crises and globally rising competitiveness concerns, is there still a need and scope for more sustainable and coherent agri-food trade policies and related instruments? Considering the evidence from the MATS project together with shifting policy agendas during the past four years, we are reminded of how much functioning institutions matter at different levels – especially at multi-lateral levels for effective trade governance and implementation of effective sustainability standards.
We observe that poor governance leads to uncertainties for value chain actors, impacting market access, investment levels, smallholder livelihoods and competitiveness and potentially contributing to market failure associated with sustainability standards implementation. Uncertainties affect global agri-food value chains as we observe not only question marks regarding WTO’s governance capacity but also delayed implementations of the EU Regulation on deforestation-free supply chains (https://ec.europa.eu/commission/presscorner/detail/en/ip_22_7444) and the implementation of the EU’s Carbon Border Adjustment Mechanism (CBAM) with yet uncertain instrument changes (https://taxation-customs.ec.europa.eu/carbon-border-adjustment-mechanism_en).
Further, we observe farm-level voluntary sustainability standards being implemented with contradicting sustainability impacts without sufficiently accounting for incoherences in reward systems underlying production standards. Instead of more governance uncertainty and policy fragmentation, MATS evidence suggests that especially EU policies should align and strive for coherence while employing a dual strategy, combining EU external mechanisms like the CBAM with country-internal measures that encourage investments, capacity building and change within trading partner countries. This call for action includes aligning trade policies with EU directives aimed at improving governance and tackling human rights and environmental challenges (EUDR, CSDDD). MATS evidence highlights that functioning institutions are relevant at all levels to move towards more sustainable trade. This includes the need to improve land ownership rights in Africa, the need to more effectively integrate IP rights into trade frameworks, and the need for institutions to be forward-looking through institutionalised impact-based sustainability assessments, with a focus on ex-ante impact assessments of trade agreements and related instruments.
For trade-relevant institutions and their governance mechanisms to be fair, functioning and effective, they need to focus on being stakeholder-inclusive and transparent in terms of their planned trade policies and implications. This also means that, as per MATS evidence, we need more investment facilitation measures alongside greater transparency regulating such investments while accounting for varying inequities among global value chain actors, with particular recognition of small-scale farmers and the frequent exclusion of female entrepreneurs from micro-credits and value chains. In the following sections, you will find MATS evidence as it emerged from the evolving output during 2021-24, highlighting actionable points for policymaking and public discourse.
(1.) Review evidence on the broad links between agricultural trade, investments and triple-bottom-link sustainability (Chen Qiuzhen & Bodo Steiner)
The literature confirms that agricultural trade is not just a function of countries and regions but especially food system actors. This, in turn, calls for more holistic perspectives and analyses, which blend micro (local, actor and on-the-ground) perspectives with macro-level data and analyses. Such an approach is the required foundation for a holistic and systemic assessment of the transboundary impacts of trade on sustainable development and human rights.
The MATS project review of linkages (https://zenodo.org/records/6410884#.YkrhvihBxPY) suggests that food system governance applies especially to key actors in terms of their roles, interests and responsibilities and how to address individual actor power and participation inequality while accounting for civil society interests. Taking a human rights perspective in analyses allows us to identify the roles of rightsholders and duty bearers, with science informing the political choices to be made. A visual overview of the broad linkages between agricultural trade, markets, investments, environmental sustainability and human rights is shown in Figure 2.
The MATS review also identified trends in agri-food trade for six agri-food products traded globally (wine, dairy, beef, pork, poultry and coffee). Their impact was identified in terms of trade flows and socioeconomic factors with respect to various trade policies (e.g., tariffs and non-tariff measures) and trade regimes (e.g., trade agreements between EU-Africa and EU-UK). This analysis (https://zenodo.org/records/6411136#.YkrhfihBxPY) included findings for key EU trade partners and regions (Figure 3).
An analysis of linkages between trade rules and SDGs focused on the EU’s Non-Tariff Measures (NTMs), a selection of EU trade agreements with developing countries, as well as Voluntary Sustainability Standards (VSS) applicable to agriculture (https://zenodo.org/records/6411209#.Ykrg4ShBxPY). For the NTMs and trade agreements, these linkages were relatively concentrated on a limited set of SDGs. However, the VSS cover a much broader range of SDGs. SDG3 (health and wellbeing) had the highest coverage in the EU’s NTMs, and SDG8 (decent work and economic growth) recorded the highest coverage in the selected EU trade agreements. For the agricultural VSS, most of the linkages are with SDG16 (peace, justice and strong institutions), whereas SDG6 (water and sanitation) recorded the weakest coverage in all three types of trade rules. An overview of the SDG linkages with the different EU trade rules and sustainability standards can be seen in Figure 4.
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This project has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement no 101000751.
