Summary
While trade negotiations have now been finalised, duty-free access has still not been restored for Ghanaian exports to the UK. Ghanaian exporters continued to pay import tariffs on banana unloaded in the UK on 7th February 2021. Urgent action is required from the UK government to add Ghana to the list of countries subject to the ‘bridging mechanism’ applied to a range of other countries where trade negotiations have been completed, but agreements have not yet been signed. Read more “Ghana-UK Trade Deal Concluded but Import Tariffs Still Being Paid on Ghanaian Goods Entering the UK Market”
Category: Horticulture
Banana Link Makes the Case for the Extension of Spanish Fair Producer Price Legislation to Pan-EU Banana Imports
Summary
Debates on proposed amendments to the Spanish 2013 Food Chain Law have highlighted how ‘fair pricing’ regulations need to be applied equally to domestic EU producers and 3rd country producers if competition between domestically produced and imported products is not to be distorted. Applying ‘fair price’ regulations to imported as well as domestically produced agricultural products would not only avoid distorting competition but would also provide scope for integrating ‘Green Deal’ sustainability objectives into both domestic and 3rd country supply chains serving the EU market. Read more “Banana Link Makes the Case for the Extension of Spanish Fair Producer Price Legislation to Pan-EU Banana Imports”
Disruptions Along EU UK Supply Routes Less Than Expected but Onward Haulage Costs Rising and Longer Time Required For Orders to Be Fulfilled
Summary
Road traffic disruptions along EU/UK ‘RoRo’ routes have been less than feared. This is largely due to a sharp drop in traffic flow along these routes. However, the changes to EU/UK border arrangements have seen an increase in road haulage costs along these routes. Some of these causes of cost increases are transitional and will decline by 2022. Other causes of cost increases are structural and could undermine the commercial viability of the use of triangular supply chains currently used to get ACP products to market. This will be a particular problem for lower value fresh produce and smaller scale ACP exporters. Individual supply chains will need to assess the long-term commercial implications of rising road haulage costs along EU-UK ‘RoRo’ routes. Policy initiatives to remove the rules of origin complications along triangular supply chains for ACP exporters whose products enjoy duty-free/quota-free access to both the UK and EU market are possible. Equally it should be possible on risk assessment ground to waive any need for phytosanitary import controls on ACP products which have recently been subject to such controls on entry to the EU when onward shipped to the UK. However, under current circumstances this will need to be negotiated bilaterally with the UK. Such initiatives would ease pressures on road haulage operators and incentivise the resumption of more normal haulage arrangements for ACP products shipped to the UK via the EU Read more “Disruptions Along EU UK Supply Routes Less Than Expected but Onward Haulage Costs Rising and Longer Time Required For Orders to Be Fulfilled”
Restoring Ghana’s Duty-Free Access to the UK Market is an Urgent Priority
Summary
The tariff bill faced by Ghanaian exporters as a result of the UK allowing pre-existing duty-free access to lapse without an ‘bridging mechanism’ in place is mounting. It is unclear how long it will be before more companies shift their sources of supply away from Ghana. Given agreement had been reached on all substantive issues of concern, the failure of the UK to include Ghana in the ‘bridging mechanism’ appears to be linked to a misunderstanding of the constitutional constraints arising from the democratic election process in Ghana. This limits the capacity of Ministers to sign international trade agreements, in the absence of due parliamentary endorsement. The adoption of a course of action by the UK government which economically penalised Ghana for respecting Parliamentary processes and constitutional requirements, would appear to be a matter deserving of urgent political attention at the highest level in the UK government. Read more “Restoring Ghana’s Duty-Free Access to the UK Market is an Urgent Priority”
The Case of Fresh Horticultural Products What Does the New EU UK Trade Agreement Mean for ACP Triangular Supply Chains?
Summary
Of the three major issues arising in the ACP horticulture sector trade in the context of the new EU/UK trade arrangement, the most important relate to rules of origin verification, given the absence of any ‘diagonal cumulation’ arrangements. This may require all ACP horticultural exports entering the UK market via the EU to remain under customs supervision (under Common Transit Convention procedures) if duty-free access to the UK market is not to be lost. Currently the infrastructure for the effective implementation of CTC procedures is not fully in place, with this potentially posing challenges for the onward trade in ACP horticultural products to the UK market. The phasing in of UK phytosanitary import controls poses tricky choices for ACP exporters in the first months of 2021. Efforts to simplify EU/UK procedures for the cross-border movement of goods could usefully take on board ACP concerns. ACP organic exporters will need to keep a close eye on how EU/UK mutual recognition of organic certification evolves in 2023, so timely and appropriate action can be taken to ensure exports can still be placed for sale as organic products in the target markets after 2023. Read more “The Case of Fresh Horticultural Products What Does the New EU UK Trade Agreement Mean for ACP Triangular Supply Chains?”
Key Challenges Identified in the NAO Brexit Preparedness Report: Implications for the ACP
Summary
The November 2020 NAO report paints a pessimistic picture of the prospects for the effective functioning of the UK/EU border controls in 2021. Developments since November 2020, in regard to the intensifying Covid-19 crisis will not have helped matters. ACP triangular supply chains, which require the movement of goods across an EU/UK border, are likely to be most severely affected. However, serious congestion at UK seaports, with both berthing and unloading delays, could mean direct ACP sea freighted exports could also face delays, with these compounding the system wide challenges UK border control authorities will face in 2021. Read more “Key Challenges Identified in the NAO Brexit Preparedness Report: Implications for the ACP”
Punishing Start to Ghana’s Post Brexit Trade Relations with the UK
Summary
Despite long-standing warnings over the complexities faced in rolling over EU trade agreements with West Africa and the need for transitional arrangement to avert a highly damaging hiatus in trade relations between Ghana and the UK, on 3rd January 2021 the UK government imposed standard MFN tariffs (£95/tonne) on Ghanaian bananas landed in the UK. This is effectively holding a gun to the head of the Ghanaian government to agree to specific provisions in the ‘rolled over’ agreement on the tariff phase down schedule. The Government of Ghana has long expressed concerns over the need to ensure consistency between it tariff commitments under the UK agreement and its regional ECOWAS trade protocol commitments. Given the political sensitivity of this issue in Ghana the ongoing UK/Ghana negotiations could run substantially beyond the matter of weeks alluded to in the Joint December 31st statement. This could seriously undermine Ghana’s long term banana export trade to the UK which has taken over a decade to build up and could ensure Ghana’s tuna canning plants which have been closed over Christmas, never reopen. The first step in the UK’s autonomous trade policy will then have been to undermine tens of thousands of jobs in a key Commonwealth ally in Africa, which represents a bastion of democratic stability in a troubled region. Read more “Punishing Start to Ghana’s Post Brexit Trade Relations with the UK”
Short Term Road Haulage Regulatory Fix Reassures Hauliers but Uncertainties Remain
Summary
The EU has proposed regulatory proposals for contingency measures in four main areas: fishing activities, aviation connectivity and safety, road transport connectivity, and rail connectivity. The two main areas of concern to ACP exporters relate to rail and road connectivity between the mainland EU and the UK. These regulatory measure for the road haulage sector while essential will not address the problems of road haulage delays and rising costs which are now emerging. However, these delays and cost increases will be much more severe from 1st January 2021 if these contingency measures are not in place. The issue of aviation connectivity, if not addressed could also carry consequences for international aviation services. This could compound the air freight challenges which have arisen as a result of the Covid-19 pandemic. Any breakdown in EU/UK fisheries relations meanwhile, could carry trade documentation and even tariff implications for the onward trade in ACP fisheries products from the EU to the UK. Read more “Short Term Road Haulage Regulatory Fix Reassures Hauliers but Uncertainties Remain”
UK Kenya Agreement Leaves Triangular Supply Chain Issues Unresolved but Suggests Progress on Rules of Origin Issues Could be Possible
Summary
A Kenya-UK trade agreement has been concluded which preserves duty free access for Kenyan exports to the UK market beyond 31st December 2020. However, this agreement fails to avoid potential disruptions of all current supply routes for tariff free access to the UK market. This is a result of the failure to address future trade issues along triangular supply chains, which serve the UK market via initial landing in the EU. This issue is of considerable importance to the East African region, given the current routes used in serving the UK market in major export sectors (e.g. cut flowers). In the context of a no-deal UK departure, issues will also arise for other major ACP triangular supply chains where some repackaging or simple processing takes place in the EU prior to onward shipment to the UK. These triangular supply chain issues need to be urgently addressed. While the relaxation of UK phytosanitary controls could facilitate an expansion of Kenyan exports to the UK, this is highly unlikely in the livestock sector. Rules of origin improvements could prove relevant in other ACP-UK EPA contexts and should be studied closely. Finally, the 7-year moratorium on tariff reductions defers any immediate conflicts between the implementation of the UK-Kenya agreement and the maintenance of a common external tariff for the East African Customs Union Read more “UK Kenya Agreement Leaves Triangular Supply Chain Issues Unresolved but Suggests Progress on Rules of Origin Issues Could be Possible”
Appointment of Chief Trade Enforcement Officer Could Signal a Push More Rigorous Enforcement of EPA Commitments Made by ACP Governments
Summary
The appointment of an EU Chief Trade Enforcement Officer is likely to see the EU more rigorously enforce the commitments entered onto by ACP governments under EPAs. Particular concerns arise in regard to the interpretation and application of provision dealing with trade defence mechanisms established under the EPAs (safeguard and anti-dumping provisions), the ‘Prohibition of quantitative restrictions’, and ‘National treatment’. The rigorous interpretation and enforcement of these commitments could undermine national agri-food sector development strategies across a wide range of ACP countries. There are concerns disputes with ACP countries constitute areas for ‘early wins’ for the CTEO, given the limited legal capacity of ACP governments to engage in dispute settlement processes and the limited scope for ACP retaliatory action. Particular concerns arise in product areas where a no-deal Brexit could generate severe EU/UK trade disruptions (e.g. the poultry meat sector) and ACP markets are major outlets for EU exports. Read more “Appointment of Chief Trade Enforcement Officer Could Signal a Push More Rigorous Enforcement of EPA Commitments Made by ACP Governments”