Category: Regions

Spanish Citrus Producers Intensify Pressure for More Controls on Citrus Imports from South Africa

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Summary

New arrangements have been set in place for phytosanitary clearing of South African citrus through the port of Vigo.  This is causing consternation in the financially stressed Spanish citrus sector, with calls being made for a ‘political solution’ to ease their plight. A variety of trade restrictive measures are being advanced including: the designation of a single EU port of entry to maximize the effectiveness of phytosanitary controls; EU in country inspections in South Africa; mandatory cold treatment for all imports; precautionary border closures when a maximum permitted level of interceptions occurs; and the invocation of the safeguard provisions of the EU-SADC EPA. However the commercial implications of many of these measures would lead generate fierce resistance from northern European commercial interests (traders, port authorities, supermarkets). Any pro-active use of pre-export risk assessment requirements against the South African citrus sector meanwhile would send shock waves across all ACP fruit and vegetable exporting countries are of which have weaker compliance enforcement capacities than the highly organized South African citrus sector. Read more “Spanish Citrus Producers Intensify Pressure for More Controls on Citrus Imports from South Africa”

Report Reviews Impact of Current CAP Financial Instruments on Developing Countries

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Summary
A study for the European Committee of the Regions has found ‘CAP subsidies continue to have a production-stimulating effect’, with EU production and exports being greater than would be the case in the absence of CAP subsidies. The case studies in the report look at the effects of CAP subsidies in regard to milk powders, chicken meat and processed tomato products on vulnerable developing countries (VDCs – which includes all ACP countries). It draws nuanced conclusions in regard to the effects of the provision of CAP subsidies but on the basis of the terms of reference of the report largely neglects the effects of CAP related EU agricultural trade policies on VDCs. The report calls for: ‘greater disciplines on coupled support payments’; adjustment to EU market management measures so they do not destabilize prices for VDC producers; ‘the phasing out of decoupled payments for income support’, and ‘the creation of a platform allowing stakeholders from VDCs to be involved in a dialogue on PCD and agri-food trade issues’. Read more “Report Reviews Impact of Current CAP Financial Instruments on Developing Countries”

Pressure Mounting on Cocoa Sector Multinationals to Pay Living Wage as part of Sustainability Accreditation

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Summary
The Conseil du Cafe-Cacao (CCC) in Cote d’Ivoire and COCOBOD in Ghana are proposing to withdraw support from cocoa  sustainability certification schemes unless companies commit to payment of the ‘living income differential’ designed to deliver to farmers 70% of a $2,600 a ton (Freight On Board) target price. The governments of Nigeria, Cameroon and Peru are also exploring the introduction of similar minimum prices for cocoa producers. Ethical trading companies have meanwhile endorsed the producer government’s calls for higher prices within the framework of a five principles approach to enhanced supply chain management. Read more “Pressure Mounting on Cocoa Sector Multinationals to Pay Living Wage as part of Sustainability Accreditation”

Tremendous Short Term Scope for African Avocado Exports Identified Although Long Term Market Saturation in the EU Likely

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Summary
While ACP exporters have seen considerable growth in avocado exports to the EU since 2008, their market share has been undermined since the entry into force of the EU-Andean Pact Trade Agreement in 2013, with this being particularly acute on the UK market. In addition while consumer demand for avocadoes continues to grow in the EU, the rate of growth is slowing down. Nevertheless African ACP countries have considerable unexploited production and export potential, with a considerable growth in the area under avocadoes being underway. The UK governments’ decision to remove MFN tariffs and import levies on avocadoes post Brexit, will further undermine the position of all but the most competitive ACP avocado exporters on the UK market. This is likely to be compounded by the potential of Brexit to disrupt the functioning of triangular supply chains for the export of avocadoes to the UK market via EU27 member states. Policy dialogues between the governments of ACP avocado exporting countries and the EU27 and UK authorities on the administrative arrangements required to minimise customs and border clearance delays for products which enjoy duty free access to both the EU27 and UK market are needed, with this dialogue being extended to arrangements for SPS inspections along triangular supply chains. Read more “Tremendous Short Term Scope for African Avocado Exports Identified Although Long Term Market Saturation in the EU Likely”

Continued Duty Free Quota Free Access to UK Market Secured but the MFN Issue Looms

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Summary
LDCs and all ACP countries who have in place Economic Partnership Agreements with the EU now have in place arrangements which will roll over existing DFQF access to the UK market. However the future value of this rolled over DFQF access will be determined by the MFN tariff regime which the UK government will apply either under a no-deal Brexit or at the end of any agreed transition period in UK/EU trade relations. While the UK  government  announced a ‘development friendly’ temporary no-deal Brexit tariff schedule in March 2019 (with this being slightly revised in October 2019), a full scale review of the UKs temporary MFN tariff schedule is planned from January 2020, with this involving a two month period of public consultations. Following on from this review it is anticipated the UK government will make an announcement on the long term MFN tariffs it plans to apply. It is only at this point that the future value of the rolled over DFQF access granted ACP countries will finally be known. The preferential duty free access rolled over for preferred ACP partner countries adds nothing to the competitive position of ACP exporters if all other competing suppliers also enjoy duty free access as a result of the elimination of MFN duties. Read more “Continued Duty Free Quota Free Access to UK Market Secured but the MFN Issue Looms”

Exploring New Cross Channel Ferry Routes for ACP Exporters Serving UK Market via EU27 Countries

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Summary
ACP exporters of short shelf life products serving the UK market via initial ports of landing in an EU27 member state will face significant challenges under a no-deal Brexit, despite the reconsolidation of duty free-quota free access to the UK market having been secured by all LDC and EPA signatory ACP countries. These ACP exporters will not only need to address the inevitable administrative challenges arising from the UK becoming a separate customs jurisdiction, but will also need to get to grips with the severe transportation disruptions a no-deal Brexit will give rise to along existing EU27/UK transportation corridors. ACP exporters using triangular trade routes will need to:

  • ensure they are ready for inevitable administrative changes a no-deal Brexit will bring about (with new EORIs BOIs and BTIs being obtained where necessary);
  • ensure valid certification and authorisations are in place and their exports remain compliant with labelling and marking requirement ;
  • clarify the location and basis of SPS inspections of products traded along triangular supply chains (ACP/EU/UK) into the UK market;
  • review and revise contractual arrangements for delivery of products to clients in the UK;
  • take unilateral action to review and revise their current shipping arrangements for serving the UK market ;
  • intensify dialogue with trade partners on how best to address specific Brexit related trade disruptions;
  • explore the use of the new ferry services being set in place to address Brexit related transportation disruption focussed on the RORO cross channel routes centred on Kent;
  • in some case seek out new direct routes to UK markets abandoning their existing triangular trade partnerships.

Read more “Exploring New Cross Channel Ferry Routes for ACP Exporters Serving UK Market via EU27 Countries”

Arla Commits to Extended Dairy sector Cooperation in Nigeria

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Summary
Arla has announced a new partnership for the promotion of local milk production in Nigeria as part of its Milky Way Partnership Nigeria initiative. However the focus on the development of commercially viable local milk supply chains needs to be seen against the background of the serious local constraints on the development of efficient milk-to dairy supply chains in Nigeria and the expansion and changing structure of EU milk powder exports which is delivering low priced milk powders to Nigeria for reconstitution into value added dairy products. The competitive pressure from imported milk powders is only likely to be exacerbated if a no-deal Brexit occurs which would inevitably disrupt existing EU27/UK trade in dairy products. Against this background it is highly unlikely that in the foreseeable future local Nigerian milk production will make any dent in the Nigerian dairy sector’s overwhelming dependence on imported milk powders for its dairy processing activities. Read more “Arla Commits to Extended Dairy sector Cooperation in Nigeria”

EU Needs to Tackle Toxic Pesticide Residues at Source by Banning Their Production in the EU

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Summary
Press reports in Kenya have highlighted the continued export by EU companies of pesticide products banned for use in the EU. This gives rise to pesticide residues which lead to Kenyan products being prevented from entering the EU market. This is seen as incoherent, with calls being made for the EU to halt the production and export of pesticides which are no longer approved for use in the EU on hazardous to health ground. Currently commercial considerations play a significant role in whether re-approval is sought for specific products. Re-approvals for products which are out-of-patent are not generally sought, particularly when newer patented products are being placed on the market. Thus the absence of re-approvals does not necessarily point to a risk to human health. Clearly better dialogue processes are needed to resolve this incoherency, with, where appropriate for the protection of human health, this being extended to addressing the problems at source by banning production and export of pesticides harmful to human health. Read more “EU Needs to Tackle Toxic Pesticide Residues at Source by Banning Their Production in the EU”

EU Skimmed Milk Powder Stocks Empty, But for How Long?

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Summary
While EU skimmed milk powder stocks are now empty, after five years of overhanging global markets, this respite could be short lived. A no-deal Brexit could so severely disrupt trade in the dairy sector that the EC would return to skimmed milk powder (SMP) intervention buying and support for private storage of SMP. As with the measures adopted in response to the August 2014 Russian import embargo  this could give rise to market consequences and trade flows which undermine efforts to promote milk-to-dairy supply chains in ACP countries, particularly in West Africa. Against this background ACP governments will need to ensure they retain the trade policy space necessary to protect local markets from disruptions where initiatives to develop and sustain local milk-to dairy supply chains are underway. Read more “EU Skimmed Milk Powder Stocks Empty, But for How Long?”

EU’s Use of Pesticide Regulations Attacked in WTO as Trade Inhibiting

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Summary
The EU has been challenged in the WTO on the use of its hazard-based approach to regulating pesticides, which it is claimed can constitute a non-tariff barrier to trade. The ACP Group has endorsed the US led challenge, which includes a request for the EU to review its current approach. The EU meanwhile has asserted its unwillingness to compromise the protection of human health. However the real issue relates to the design and application of EU pesticide residue controls and other import control requirement on agricultural products. It is in regard to design and application of EU import controls where more effective dialogues are required to ensure that while protecting human health no unnecessary barriers are created. While there is general agreement on this in principle the key area of contention is how to operationalise this approach in practice. At the ACP level there would appear to be a need for: greater pan-ACP cooperation in such policy dialogues with the EU; closer coordination between producer organisation, competent authorities and diplomatic representatives in Brussels; and enhanced coordination between ACP representatives in Brussels and Geneva in international fora and bilateral discussions with the EU. Read more “EU’s Use of Pesticide Regulations Attacked in WTO as Trade Inhibiting”