Summary
Growth in African poultry production is projected to lag behind growth in consumption making Africa the region with the highest rate of growth in poultry meat imports. African governments need to adopt policies which will encourage poultry companies in exporting countries to invest in local poultry meat production. This would build on an emerging trend. This may require managed trade regimes in the poultry meat sector, similar to those used by the EU. This may also require flexibility in how existing EPA commitments on the use of non-tariff trade policy tools are interpreted and applied so as to create market space for expanded domestic production. However the trade disruptive effects of a ‘no deal’ could make it more difficult for the EC to implement such a flexible approach. Read more “Growing African Demand Fuelling Poultry Meat Imports with EU Likely to Continue to Play Major Role”
Category: Regions
ACP Banana Sector Concerns Raised in EP Opinion on Apportioning Bilaterally Negotiated EU TRQs within the Brexit Process
Summary
The issue of the future of EU TRQs negotiated as part of FTAs has been formally raised in the European Parliament opinion on the EU’s proposal for apportioning WTO agreed TRQs. This is an important issue for ACP banana exporters, particularly Cameroon, Ivory Coast and Surinam, whose banana exports are focused on EU27 markets. Any failure to apportion existing EU bilaterally negotiated TRQs would de facto increase competition on EU27 markets in the post-Brexit period by around 20%. With this potentially have severe price effects on ACP suppliers. With the potential for a ‘no-deal’ Brexit increasing there is an urgent need for the European Commission to clarify its approach on this issue, so ACP banana exporters can develop marketing strategies to deal with the increase in competition on EU27 markets they may face from 30th March 2019. Read more “ACP Banana Sector Concerns Raised in EP Opinion on Apportioning Bilaterally Negotiated EU TRQs within the Brexit Process”
Sugar Substitution Gaining Pace in EU Amid Falling EU Import Demand
Summary
While the impact of EU sugar production quota abolition is the most immediate concern to ACP exporters given the dramatic decline in EU prices paid for ACP sugar and the 60% decline in ACP sugar export volumes to the EU, the long term trend towards replacing sugar and reducing sugar usage in food and drinks is also a major source of concern. This will lead to an overall reduction in EU sugar consumption in a context where the future scaling back of EU production from record levels in 2017/18 is unlikely to see a return to historical levels of EU imports from ACP countries. This is likely to be compounded by the withdrawal of the UK from the EU. This means ACP sugar exporters will need to look to markets in Asia and particularly for African producers, in Africa. They will also need to look to the more systematic exploitation of non-sugar revenue streams linked to sugar cane production. Read more “Sugar Substitution Gaining Pace in EU Amid Falling EU Import Demand”
Calls for Stricter EU Measures Against UTPs
Summary
EU regulations to combat unfair trading practices along agro-food supply chains, including within 3rd country supply chains serving the EU market continue to make progress through the legislative process. It is estimated EU farmers lose some €11 billion because ‘retail chains change contracts after they’ve been agreed upon or cancel orders at short notice’. ACP exporters also suffer from UTPs particularly last minute cancellations of orders and retroactive changes to agreed sales arrangements. The financial consequences of the UTPs can be quite severe, so operationalising the new UTP regulation as it applies to ACP-EU supply chain could lead to immediate improvements in the financial returns to ACP producers, particularly smallholder horticulture producers. This issue could potentially be taken up in the context of the forthcoming ACP-EU post-Cotonou negotiations. This can be seen as an urgent issue since a ‘no-deal’ Brexit could disrupt triangular horticulture supply chains, with any resulting losses being passed down to primary producers in Africa and other ACP regions. Read more “Calls for Stricter EU Measures Against UTPs”
EU/UK Proposals for Brexit Related TRQ Apportionment Continues to be Challenged
Summary
September 2018 saw WTO members again objecting to EU/UK agreed plans for apportioning WTO agreed TRQ market access arrangements without consultations with the affected partners. While ACP exporters are only marginally affected by this WTO level TRQ apportionment issue, ACP exporters have serious concerns over how the EU plans to apportion bilaterally negotiated TRQ established under EU FTAs. This could for example carry serious implications for ACP banana exporters, who from 30th March 2019 could face a de facto 20% increase in competition from $ banana exporters on EU27 markets. The governments of ACP banana exporting countries need to urgently seek consultations with the EC on what will happen to EU bilaterally negotiated banana TRQs from the 30th March 2019 under a ‘no-deal’ Brexit scenario. Or alternatively, if a Withdrawal Agreement is concluded and a transition period in EU/UK trade relations is set in place, what will happen to these bilaterally negotiated TRQ arrangements from 1st January 2021. Read more “EU/UK Proposals for Brexit Related TRQ Apportionment Continues to be Challenged”
EU Sees Mauritania’s EPA signature as Stepping Stone to an EU-Africa FTA?
Summary
The EU has sought to place Mauritania’s signature of the West African EPA in the context of the ‘new Africa-Europe alliance for sustainable investment and jobs’ initiative. The ultimate aim of this initiative is to secure a comprehensive EU-Africa FTA. The EC wants to see this include a revisiting of disciplines on domestic policy formulation which African governments consciously steered away from under the EPA negotiations. This needs to be seen in the context of the relative failure of the EC in securing FTAs with African countries. After 16 years of negotiations only 15 African governments have signed, ratified and are in the process of implementing EPAs, with this embracing only 24% of the population of sub-Saharan Africa. Against this background the EC appears to be looking to harness the ‘cart’ of its trade and investment ambitions in Africa to the ‘horse’ of the African Continental Free Trade Area. This could potentially complicate efforts to create a pan-African free trade area for agro-food products. In this context, in operationalising AfCFTA commitments, African governments will need to address the challenge of how to ensure the ‘tail’ of EPAs with the EU does not end up wagging the ‘dog’ of pan-African trade integration, simply by virtue of being first on the scene. Read more “EU Sees Mauritania’s EPA signature as Stepping Stone to an EU-Africa FTA?”
EU Poultry Exports to South Africa In the Face of Avian Influenza Based Export Restrictions
Summary
The introduction of Avian Influenza (AI) based restriction on imports from the EU has reversed the expansion of imports of EU poultry meat to South Africa which has been underway since 2010. However with local AI outbreaks depressing South Africa’s own poultry meat production imports increased from Brazil and the USA. SAPA continues to argue a major reduction in import volumes is needed if the South African poultry sector is to fulfil its potential as a creator of jobs and promoter of rural development. South Africa continues to call for an international initiative to address the problem of surplus ‘dark meat’. However the EU is unlikely to respond favourably to such suggestions given the potential threat to the EU poultry sector posed by Brexit related trade disruptions. Indeed under a ‘no-deal’ Brexit scenario the pressure to find new export markets for both EU27 and UK poultry meat is likely to increase. Read more “EU Poultry Exports to South Africa In the Face of Avian Influenza Based Export Restrictions”
How Close is the UK to ‘Rolling-Over’ EPAs into UK-Only Trade Agreements?
Summary
During her August tour of 3 African countries Prime Minister May reiterated the UK’s desire to ‘roll-over’ existing EU EPAs into UK-Only trade agreements as a way ensuring continuity of market access. However the joint statement signed in South Africa recognised there are a range of technical issues which still need to be resolved. In reality these range from: how precisely existing duty free access to the UK market is to be maintained from 30th March 2019 onwards; how complex rules of origin issues are to be addressed in ways which enhance export opportunities for ACP exporters and avoid disruption of current UK exports; the precise UK SPS controls to be applied post Brexit and whether this could reduce current non-tariff barriers to ACP exports; whether steps will be taken to eliminate unfair trading practices along ACP-UK supply chains and whether quantitative restrictions will be applied to South African exports to the UK where the UK has no or only limited domestic production interests. Read more “How Close is the UK to ‘Rolling-Over’ EPAs into UK-Only Trade Agreements?”
Will 2018 Be The Last Time South Africa Calls An Early Halt to Citrus Exports to Europe?
Summary
The South African season for the export of Valencia oranges to the EU has been terminated early to maintain the zero level of interceptions for citrus black spot achieved this year. The withdrawal of the UK from the EU could make this the last year such action is needed. However this would require the South African government to secure under any ‘UK-only’ trade agreement the waiving of citrus black spot controls on exports to the UK and the lifting of quantitative restrictions on citrus exports to the UK market. The removal of CBS controls on exports to the UK would not only benefit South Africa but also neighbouring Swaziland and Zimbabwe and, in the Caribbean, Belize. Read more “Will 2018 Be The Last Time South Africa Calls An Early Halt to Citrus Exports to Europe?”
Traidcraft Highlights the Impact of the Brexit Process on Smaller Scale Suppliers in Developing Countries
Summary
Currency depreciation, economic recession, uncertainty over the future basis for access to the UK market and the disruption of triangular Fairtrade supply chains serving the UK market via a EU27 member states are some of the main effects of Brexit on Fairtrade producers highlighted. Urgent unilateral UK government action is required to guarantee continued duty free-quota free access to the UK market for ACP exporters. The disruption of triangular supply chain in the cocoa/chocolate sector is a particular source of concern. This concern reaches beyond Fairtrade producers given the importance of this trade to Africa’s overall agro-food sector exports to the EU and the depressed state of the global cocoa market. Small scale importers face particular challenges in ‘Brexit-proofing’ their supply chains, with government assistance modelled on the Irish governments “Be Prepared Grants’ being urgently needed. Read more “Traidcraft Highlights the Impact of the Brexit Process on Smaller Scale Suppliers in Developing Countries”