Summary
Press reports suggest the South Africa is planning to pursue a case at the WTO over the EU’s trade restrictive use of Citrus Black Spot (CBS) related SPS measures. However this may be aimed at bringing into the public domain the scientific basis for EU CBS controls. This would then provide a more solid basis for the negotiation of a reduction in the severity of these commercially expensive controls. This could side step some of the political pressures which any for a wider review of EU SPS controls would generate. However structural changes in the Spanish citrus sector look likely to intensify producer pressures for import restrictions unless the functioning of citrus supply chains can be improved to the benefit of Spanish producers. While scope will exist under a no-deal Brexit for a review of UK CBS controls it is unclear whether the stalled Continuity Agreement negotiations are covering these phytosanitary issues. The UK government faces severe capacity constraints in this area of policy dialogue; constraints which are only likely to get more severe under a no-deal Brexit scenario. Read more “South Africa to Take EU to WTO Dispute Settlement over Citrus Black Spot Controls”
Category: Southern Africa
How Would ACP Least Developed Countries Be Impacted by a 12th April No Deal Brexit?
Summary
The ending of the two year notification period set out under Article 50 of the EU Treaty alongside the House of Commons rejection of the Withdrawal Agreement for a 3rd time, leaves the Brexit process on borrowed time. The UK government will now have to submit an alternative way forward in the Brexit process if a no deal Brexit is to be avoided on the 12th April 2019. While this may include a longer extension of the Article 50 period beyond the 2 weeks the EU Council has currently granted, the prospect of a no-deal Brexit on 12th April cannot be ruled out. This is despite a huge 240 Parliamentary majority against the UK leaving the EU without a deal. While a no-deal Brexit will not impact on the duty free quota free access which LDCs enjoy to the UK market, where the UK government has committed to rolling over the existing EU preferential system for LDCs as a unilateral UK trade arrangement, a wide variety of non-tariff related issues will also need to be addressed. If these issues are not comprehensively addressed then current trade flows from LDCs could be disrupted in the short term while in the longer term the value of the duty free-quota free access enjoyed could be undermined by changes in the UK’s independent MFN tariff regime. In addition there are a range of UK trade policy issues which need to be addressed if trade with least developed countries is to become a tool for wider poverty focussed sustainable development in LDCs. Most notably in this regard are the rules of origin and SPS control requirements to be applied by the UK to imports from LDCs. Read more “How Would ACP Least Developed Countries Be Impacted by a 12th April No Deal Brexit?”
Which ACP EPA Signatory Countries Would be Most Vulnerable to a 12th April No Deal Brexit?
Summary
With the ending of the two year notification period set out under Article 50 of the EU Treaty and the House of Commons having rejected the Withdrawal Agreement for a 3rd time, the Brexit process is on borrowed time. The UK government will now have to submit an alternative way forward in the Brexit process if a no deal Brexit is to be avoided on the 12th April 2019. While this may include a longer extension of the Article 50 period beyond the 2 weeks the EU Council has currently granted, the prospect of a no-deal Brexit on 12th April cannot be ruled out, despite a huge 240 Parliamentary majority against the UK leaving the EU without a deal. Against this background, after providing an update on the Brexit process in the UK, this article reviews the situation of ACP countries and regions which currently trade with the UK under an EU EPA. Read more “Which ACP EPA Signatory Countries Would be Most Vulnerable to a 12th April No Deal Brexit?”
Brexit Delayed but No Deal Brexit Still on the Table
Summary
While the UK has sought an extension of the Article 50 process, the EU Council has limited the duration of the extension granted, with this being conditional on approval of the Withdrawal Agreement. Failure of the UK Parliament to approve the Withdrawal Agreement would require an alternative way forward to be identified if the UK was not to leave under a ‘no-deal’ scenario on 12th April. While the UK’s unilateral EBA style trade regime for LDCs and the signing of a ‘Continuity Agreement’ will ensure continuity in tariff treatment for access to the UK market, these agreements will not on their own ensure continuity in trade flows nor continuity of the value of current ACP DFQF access beyond June 2020. For this to be achieved both additional special arrangements will need to be set in place immediately upon the UK’s withdrawal and a multiplicity of supplementary commitments will be required from the UK government if the current value of ACP trade arrangements with the UK is to be preserved and enhanced. Read more “Brexit Delayed but No Deal Brexit Still on the Table”
The UK’s Proposed New MFN Tariff Regime: Protects ACP Interests in the Short Term But…..
The UK’s Proposed New MFN Tariff Regime: Protects ACP Interests in the Short Term
Summary
While the UK’s proposed no-deal Brexit MFN tariff schedule would ease immediate ACP concerns over the loss of value of rolled over tariff preferences arising from the removal of MFN import duties, the short duration of the proposed measures provides no longer term assurances of the value of any tariff preferences which might be rolled over under the UK’s proposed ‘Continuity Agreements’. The new announcement leaves unaddressed just how the UK plans to roll over existing ACP tariff preferences under a no-deal outcome to the current Brexit negotiations. Indeed, it could see ACP banana, horticulture, rice, beef, fisheries and cocoa product exporters all facing new tariffs on exports to the UK if Continuity Agreements are not concluded by the date of the UK’s ‘no-deal’ departure from the EU. What is more serious questions have been raised as to the viability and sustainability of specific UK proposals to avert a hard border on the island of Ireland. Read more “The UK’s Proposed New MFN Tariff Regime: Protects ACP Interests in the Short Term But…..”
Growth in EU28 poultry meat exports to ACP markets could accelerate under a no deal exit of the UK from the EU
Summary
SPS restrictions on poultry meat imports from Brazil saw EU poultry meat production expand in 2017 despite AI outbreaks. This highlights how important trade measures can be in stimulating domestic poultry meat production. In the face of AI related import bans EU poultry meat exporters have found new alternative markets for exports in Africa. The projected 3.9% expansion of EU poultry meat production to 2030 will drive a further expansion of exports (+18.4% or +219,000 between 2018 and 2030), with growing volumes of poultry parts being exported to Africa at progressively lower prices. Given likely Brexit related disruptions of the EU27/UK poultry meat trade, export growth to Africa could be even higher, particularly for UK poultry parts exports of which are currently concentrated on EU27 markets. Potential Brexit related trade effects are not factored into current EU projections. ACP governments may need to use non-tariff trade policy tools to protect against sudden import surges, with this potentially becoming a contentious issue. Additional SPS issues arise from the growing level of processing of Ukrainian raised chickens in the EU, parts of which are then exported as EU chicken to ACP markets. Read more “Growth in EU28 poultry meat exports to ACP markets could accelerate under a no deal exit of the UK from the EU”
Is the Final Count Down to Brexit Underway or Will the ACP have Three More Months to Take Action to Mitigate the Trade Disruption Effects of No Deal Brexit?
Summary
The UK government has now laid down a clear Parliamentary route to defining a final UK position on the ‘no-deal’ Brexit option. This could lead to an extension of the article 50 process for either 3 month or 21 months. This would provide time for ACP governments to set in place policy initiatives to mitigate the adverse effects of a no-deal Brexit on ACP trade with both the UK and the EU27. This would require the launching of a specific political initiative towards the UK government to ensure three major issue clusters are addressed: the shortcomings of the UK’s existing ‘Continuity Agreement’ approach; the trilateral administrative arrangements required to ensure continuity of trade flows in the immediate post-Brexit period and the value of existing DFQF access granted ACP countries is retained through accommodating ACP concerns in the UK’s future MFN tariff schedule. It would also require the launching of a political initiative towards the EU to ensure issues in future EU27 relations arising from the UK’s departure from the EU are fully addressed, so as to reduce the adverse effects of Brexit on ACP economies. Read more “Is the Final Count Down to Brexit Underway or Will the ACP have Three More Months to Take Action to Mitigate the Trade Disruption Effects of No Deal Brexit?”
‘No-Deal’ Brexit Challenges in Cut Flower Sector Highlight Problems for ACP Triangular Supply Chains
Summary
The Netherlands plays a dominant role as a distribution hub for ACP cut flowers to markets across the EU28. Any disruption UK cut flower imports from the Netherlands would carry important implications for most ACP cut flowers exporters, unless remedial administrative measures can be put in place. The likelihood of delays stripping value out of cut flower supply chains will require the role of the UK Groceries Code Adjudicator to be extended, with a special focus on ensuring unfair trading practices don’t increase in response to Brexit related trade disruptions. ACP cut flower exporters will need to urgently explore the scope for increased direct freight flights to the UK to circumvent delays along triangular supply chains. Those ACP cut flower exporters who can successfully ‘Brexit proof’ their supply chains will be well placed to capitalise on the shortages and rising prices a ‘no-deal’ Brexit could give rise to. Read more “‘No-Deal’ Brexit Challenges in Cut Flower Sector Highlight Problems for ACP Triangular Supply Chains”
First Post Production Quota Year Shows Dramatic Changes on the EU Sugar Market
Summary
The 2017/18 marketing year saw a dramatic fall in imports from EPA/EBA suppliers of some 58% compare to the 2016/17 season. This extended the trend in declining ACP sugar exports which has been underway since the 2013/14 marketing year. This situation on the EU market is unlikely to improve, with the impact of Brexit potentially making the EU27 market situation more difficult for ACP sugar exporters. However opportunities for ACP exporters on the UK market could emerge under a ‘no-deal’ Brexit scenario, if ACP EPA signatory governments can secure a continuation of current duty free-quota free access to the UK market form 30th March 2019. This situation however will be complicated by the likely lobbying by Tate & Lyle Sugars for an expansion of its access to world market priced sugar for refining. Further complications arise from the growing volume of EU white sugar exports to African markets, which, given population and per capita sugar consumption trends, are themselves increasingly attractive to African sugar producers. ACP sugar producers and exporters will need to develop more sophisticate marketing strategies to deal with an increasingly complex set of changing market parameters. Read more “First Post Production Quota Year Shows Dramatic Changes on the EU Sugar Market”
Europeanisation of National EU Poultry Producers Continues with New Plukon Acquisition
Summary
The recent acquisition by Plukon highlights the pan-European nature of EU poultry companies. This potentially complicates the application of ACP SPS controls on imports of poultry meat from the EU, in the face of regular national outbreaks of HPAI, which requires the application of protective SPS measures. Intra-corporate trading raises the issue of need for country of origin labelling of EU products based on the country in which poultry was raised (not processed. This would facilitate effective SPS controls in the face of frequent outbreaks of HPAI in individual EU member states. Issues also arise around the application of country specific anti-dumping duties and rules of origin under EU trade agreements since such measures can easily be circumvented given the pan-European structure of many EU poultry companies, with this in some instances extending beyond the EU’s borders. Read more “Europeanisation of National EU Poultry Producers Continues with New Plukon Acquisition”