Summary
Following the signing of the Ghana-UK trade agreement in London on 2 March 2021 and the tabling of a statutory instrument on 4 March, duty free access will be restored for Ghanaian exports to the UK on 5 March 2021. This will avert the further imposition of UK import tariffs, which in the past 2 months have cost Fairtrade banana exporters over £177,000. It is unclear what long-term implications the recent hiatus in Ghana’s duty-free access will carry for the sourcing decisions of UK importers, a number of which in the past two months have looked elsewhere for supplies. Read more “Ghana’s Duty-Free Access to UK Market Restored”
Category: Brexit
EU Poultry Meat Exports to Sub Saharan Africa Prove Resilient Despite Overall Decline in EU Poultry Meat Exports and South Africa Trade Policy Initiatives
Summary
Despite a decline in overall EU poultry meat exports in 2020, exports to Ghana and the DRC two major export destinations increased. While exports to sub-Saharan Africa as a whole fell, due to the application of import control measures by the South African government, excluding trade with South Africa, EU poultry meat exports to sub-Saharan Africa grew overall. Looking at longer term trends to non-South African sub-Saharan African markets EU export volumes increased 70% between 2012 and 2020 while the average price of such imports fell 26.4%. In the sub-category of frozen chicken meat, the average price of imports from the EU fell 29% while volumes almost doubled. While the EC consistently argues the EU does not ‘dump’ poultry meat on sub-Saharan African market, the undeniable reality is that since 2012 average unit prices of EU poultry meat exports have fallen. Despite this reality, the EC continues to pursue a nominal policy which restricts the ability of governments, in African countries which are major recipients of EU poultry meat exports, to make use of the kind of quantitative controls on imports routinely used by the EU in its trade with major poultry meat exporters. Read more “EU Poultry Meat Exports to Sub Saharan Africa Prove Resilient Despite Overall Decline in EU Poultry Meat Exports and South Africa Trade Policy Initiatives”
Future Caribbean Trade Relations with the UK: Summary of Areas of Concern
Summary
The new EU/UK rules of origin requirements for the cross-border movement of goods could prove disruptive of certain Caribbean rum, horticulture, sugar and potentially rice supply chains. At the business level this will require a rethinking of routes to markets. At the policy level it will require a sustained engagement to secure a right of automatic cumulation for all Caribbean products enjoying duty-free/quota-free access to both the EU and UK markets, when traded across an EU/UK border. Only such a policy innovation would remove the rules of origin complications which threatened to make commercially non-viable the current Caribbean exports which are routed via the EU to the UK market or via the UK to EU markets. Read more “Future Caribbean Trade Relations with the UK: Summary of Areas of Concern”
Two weeks after the Conclusion of Ghana UK Trade Negotiations UK Import Tariffs on Ghanaian Products Remain in Place
Summary
Two weeks after the conclusion of UK-Ghana trade agreement negotiations, Ghanaian exporters continue to face UK import tariffs. It took the UK government only two days to ensure duty-free access for Cameroonian exports following the conclusion of the negotiations at the end of December 2020. The restoration of Ghanaian duty-free access on a transitional basis, pending formal signing, would appear appropriate, particularly since this is allowed for in the formal provisions of the concluded agreement. It remains a mystery as to why the UK government has not taken all necessary steps to ensure Ghana’s duty-free access was immediately restored following the conclusion of the negotiation process. Read more “Two weeks after the Conclusion of Ghana UK Trade Negotiations UK Import Tariffs on Ghanaian Products Remain in Place”
EU Sugar Projections to 2030 Suggest Less Room on EU27 Market for ACP Sugar Exports
Summary
Expanding EU sugar production and contracting EU sugar consumption up to 2030 will see EU sugar imports decline (by -300,000 tonnes) and EU sugar exports expand (+700,000 tonnes) compared to 2020. This will increase competition for ACP sugar exports on the EU27 market, in a context where heightened health consciousness and active campaigning is seeing pressure to reduce ‘hidden sugars’ in food and drink products. Further pressures to move away from the use of cane sugar in high sugar content food and drink products will arise from the rules of origin agreed under the EU/UK trade agreement. ACP sugar exporters will need to better understand the market components their exports serve and how they will be impacted by evolving trends. The pressures on ACP sugar exporters could be eased by policy interventions designed to secure automatic cumulation under rules of origin where duty free/quota free access is enjoyed to both the EU and UK markets. Read more “EU Sugar Projections to 2030 Suggest Less Room on EU27 Market for ACP Sugar Exports”
East African Fresh Product Export Supply Chains Disrupted by Brexit Related Changes in Border Clearance Requirement
Summary
The impact of new EU/UK border clearance requirements on the costs faced by East African fresh produce exporters serving the UK market via the EU is becoming apparent. In some cases, this is severely impacting on export volumes destined for the UK market shipped along triangular supply chains. The dilemma is faced of whether to ship under customs supervision and face inspection delays at the UK border, or clear customs and SPS inspections in the EU and risk losing ‘originating’ status and hence facing MFN tariffs when entering the UK. This dilemma is faced by a multiplicity of East African exporters who use triangular supply chains. LDC based exporters are particularly disadvantaged, given the absence of clear structure for dialogue with the UK on resolving customs and trade facilitation issues. Read more “East African Fresh Product Export Supply Chains Disrupted by Brexit Related Changes in Border Clearance Requirement”
Ghana-UK Trade Deal Concluded but Import Tariffs Still Being Paid on Ghanaian Goods Entering the UK Market
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”
Non-Tariff Issues Threaten to Undermine UK Meat Exports to EU27 Markets and Generate Displace of UK Exports to ACP Markets
Summary
The shortage of UK veterinarians required to sign off on Export Health Certificates could seriously constrain UK exports of livestock products destined for the EU market. While Export Health Certification issues should impact on exports to all destinations, if the UK government adopts the BMPA proposals to use supervised Certification Support Officers instead of fully qualified veterinarians to sign off on Export Heath Certificates this could facilitate exports of UK livestock products. However, the EU is unlikely to accept such a downgrading of export health certification controls, without a thorough assessment of the phytosanitary and food safety implications. This could create a situation where in 2021 the new supervised Certification Support Officers were able to sign off on exports to non-EU destinations but not exports to the EU. This would lay the basis for an expansion of displaced UK livestock product exports to ACP markets rather than the EU markets currently served. In the poultry sector, this needs to be seen in a context where over half of all UK extra-EU poultry meat exports were destined for ACP market in 2019. Read more “Non-Tariff Issues Threaten to Undermine UK Meat Exports to EU27 Markets and Generate Displace of UK Exports to ACP Markets”
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”