EU Sugar Exports to ACP Markets Are Falling After Record Levels of EU Exports in 2018

May 8, 2019May 28, 2019 epamonitoring

Summary
While after the exception level of EU sugar exports in 2018, export volumes are projected to be substantially reduced in 2019 (with export levels down 50% so far), these are still projected to be above EU export volumes in 2016/17 (+73% so far). What is more on average ACP markets in 2018 took 1 in every 5 tonnes of extra-EU sugar exports, up from 1 in every 14 tonnes in 2014. West Africa is the main ACP region for EU sugar exports, with Ghana and Senegal the two most important markets. Central Africa is the second most important ACP region with Cameroon leading the way as a destination for EU sugar exports. There have been surprisingly high levels of EU sugar exports to the eastern and Southern Africa region, given this is a sugar surplus region. EU sugar exports to the Caribbean have varied with exports to Haiti dominating the trend in overall EU sugar exports. While weather events and national trade policies play a role in patterns of EU sugar exports, there are concerns that ‘no-deal’ Brexit related trade disruption could lead to a growing EU corporate focus on sub-Saharan African markets. This could well give rise to pressure form the EC on ACP governments to abandon policies which restrict EU sugar exports.

Overview EU Sugar Exports to ACP Markets

The expansion of EU sugar production in response to the planned abolition of EU sugar production quotas saw a major expansion of EU sugar exports in 2017/18, to a total for the season of 3,353,000 tonnes (1). This expansion of exports began even before the 1^st October 2017 abolition of EU national sugar production quotas. In terms of exports to ACP markets it began in 2016, while in terms of overall extra-EU exports it began in 2017.

A review of 2018 EC market access data base statistics shows that in 2017 total EU sugar exports rose 59% compared to 2016, while exports to ACP countries increased 151% compared to 2016. 2018 saw a further 49% increase in total extra-EU sugar exports and a further 24% increase in exports to ACP countries. Average annual EU sugar exports to ACP countries in 2017 and 2018 were over four times larger than the annual average for the years 2014,2015 and 2016 (550,969 tonnes compared to 136,762 tonnes) (2).

By 2018 the EU was exporting 611,244 tonnes of sugar to ACP countries, with this accounting for 18.9% of total extra-EU sugar exports, up from 6.9% in 2014. Overall, since 2014 EU sugar exports to ACP markets have increased 482.5% while overall EU sugar exports between 2014 and 2018 increased only 113%. On average in the two post quota years of 2017 and 2018 ACP countries took 1 in every 5 tonnes of sugar which the EU exported. By 2018 the EU was exporting 77% as much sugar as it was importing from ACP countries, this compares to only 5.6% in 2014, when the EU was importing almost 18 times more sugar from the ACP than the EU was exporting to ACP markets (2).

EU Sugar Export Total and to ACP Countries (tonnes)

	2014	2015	2016	2017	2018	% change 17-18
EU Total exports	1,523,854	1,342,485	1,370,544	2,178,927	3,241,842	+48.8%
– Sub Total ACP	104,937	109,988	195,360	490,694	611,244	+24.6%
ACP annual % change	-2.3%	+4.8%	+77.6%	+151.2%	+24.6
% share ACP of total	6.9%	8.2%	143%	22.5%	18.9%

Source: Extracted from EC, Market Access Data Base, https://madb.europa.eu/madb/statistical_form.htm

A Heavy Concentration of EU Sugar Exports in West Africa

EU sugar exports to ACP countries are heavily concentrated in West Africa, which took almost 2/3^rd of total EU sugar exports to ACP markets.

By far the most important West African markets are Ghana and Senegal, taking in 2018 25.2% and 21.8% respectively of total EU sugar exports to West Africa. Between 2014 and 2018 EU sugar exports to Ghana and Senegal increasing respectively 32-fold, 9-fold (2). In the first four months of 2019 Ghana retained its leading position as a destination for EU sugar exports to West Africa. Guinea and Togo followed, taking 12.5% and 12.1% of total EU sugar exports to West Africa, on the back of a 19-fold and 25-fold increase in EU exports between 2014 and 2018. The 2014-18 also saw a 4-fold increase in sugar exports to Benin and Burkina Faso., who by 2018 were taking 8% and 7.9% of total EU sugar exports to West Africa (2).

Since 2014 Mauritania has also seen strong growth in EU sugar exports, with in 2017 Mauritania surging into the position as the leading destination for EU sugar exports, taking 41% of all exports to West Africa. However this was not sustained with export volumes falling 87% in 2018, to account for only 3.6% of total EU sugar exports to West Africa. Mali meanwhile saw a 56 fold increase in EU sugar export volumes, coming to take 4.9% of EU exports to the region in 2018, while Sierra Leone has also emerged as a growing destination market (an 8-fold increase since 2014), taking 6.6% of export to West Africa in 2018 (2).

A noticeable trend since 2014 has been the virtual disappearance of Nigeria as a destination market for EU sugar exports, with Nigeria having previously been not only the leading destination for EU sugar exports in West Africa but across the whole of the ACP.

This may well be attributable to efforts by the Nigerian government to promote domestic sugar production through more tightly controlling imports (3). This policy may also account for why between 2014 and 2018 there was a four-fold increase in EU sugar exports to Benin (2). In April 2019 Dangote Sugar claimed ‘illegal, low-quality imports’ were ‘putting pressure on its selling price’. It was claimed that ‘although Nigeria banned packaged-sugar imports to protect local industries and diversify the economy, importers take advantage of the nation’s porous borders to bring in the product’. It was reported Dangote’s sugar revenue dropped 26% in 2018, while net income fell 44% (4)

EU Sugar Exports to West Africa (tonnes) % share exports to West African region

	% share 2018	2014	2015	2016	2017	2018	% share 2018
West Africa		57,472	56,895	55,045	280,536	406,825
Ghana	5.55%	3,187	4,586	9,192	42,441	102,417	25.2%
Senegal	16.65%	9,568	11,690	10,717	22,566	88,759	21.8%
Guinea	4.64%	2,668	1,570	1,679	7,645	52,175	12.8%
Togo	3.38%	1,940	12,385	5,282	19,070	49,401	12.1%
Benin	13.21%	7,593	10,704	5,541	17,624	32,687	8.0%
Burkina Faso	16.03%	9,215	4,331	4,706	6,594	32,110	7.9%
Sierra Leone	5.78%	3,324	3,211	8,193	21,739	26,822	6.6%
Mali	0.62%	354	677	340	14,508	19,968	4.9%
Mauritania	0	0	1	45	115,330	14,518	3.6%
Niger	6.32%	3,634	4,995	6,182	9,074	7,317	1.8%
Liberia	0.28%	161	155	220	874,	4,378	1.1%
Ivory Coast	0.22%	124	29	20	246	4,247	1.0%
Guinea Bissau	0.002%	1	71	67	239,	2,853	0.7%
Cape Verde	0.34%	195	213	288	285	1,150	0.3%
Sao Tome & Principe	4.14%	2,379	2,264	2,573	1,335	704	0.2%
Nigeria	23.46%	13,483	13	–	966	6	0.001%

Source: EC, Market Access Data Base, https://madb.europa.eu/madb/statistical_form.htm

Central Africa Variable Export Trends

The second most important market for EU sugar exports in the ACP was Central Africa. Cameroon was the most important market for EU sugar exports to Central Africa accounting for 60% of export to the region, down from almost 75% in 2014, following a diversification of EU export markets in the region.

EU Sugar Exports to Central Africa (tonnes) % share exports to Central African region

	% share 2018	2014	2015	2016	2017	2018	% share 2018
Central Africa		35,190	32,089	63,570	67,746	87,806
Cameroon	74.93%	26,367	22,292	38,356	55,604	52,740	60.06%
Angola	11.07%	3,894	3,952	18,312	6,143	25,377	28.90%
Chad	0.45%	16	17	21	757	5,916	6.74%
Equatorial Guinea	6.18%	2,173	2,273	2,569	2,142	2,165	2.47%
DRC	0.92%	323	255	447	768	760	0.87%
Gabon	7.65%	2,693	3,135	3,794	2,277	618	0.70%
Congo	0.03%	12	164	65	53	228	0.26%
CAR	0.10%	35	1	6	2	2	0.002%

Source: EC, Market Access Data Base, https://madb.europa.eu/madb/statistical_form.htm

EU exports to Cameroon nevertheless doubled between 2014 and 2018. The most dramatic areas of growth in EU exports to central Africa occurred to Angola (a 6 ½ fold increase) and Chad with an increase from 16 to nearly 6,000 tonnes between 2014 and 2018. In addition from a limited base EU sugar exports to the DRC have more than doubled (2).

However EU sugar exports to other Central African markets such as Gabon and CAR have shown declines with this being most noticeable in the case of Gabon. EU sugar exports to Equatorial Guinea meanwhile have largely stagnated though be it on a variable trend (2).

Eastern and Southern Africa: Surprising Export Growth

While given the close proximity and sugar deficit nature of these markets these patterns of EU market exports were understandable, more surprising is the expansion of EU sugar exports to Eastern and Southern Africa markets. This region, as a whole, is a surplus sugar production region. By 2018 this region was taking a total of 109,218 tonnes of EU refined sugar up from a mere 5,217 tonnes in 2014 (2).

EU Sugar Exports to Eastern and Southern Africa – ESA (tonnes) % share exports to ESA region

	% share 2018	2014	2015	2016	2017	2018	% share 2018
Sub-Total ESA		5,217	13,642	67,733	124,189	109,218

Southern Africa	4.93%	257	4,483	32,023	36,605	50,621	46.35%
South Africa	2.89%	203	4,480	32,022	15,768	42,421	38.84%
Namibia	0.98%	51	–	1	10,836	8,194	7.50%
Mozambique	0.06%	3	3	0	1	6	0.01%

EAC	1.36%	71	5,255	5,135	28,883	44,276	40.54%
Kenya	0.65%	34	978	2,061	3,285	21,859	20.01%
Tanzania	0	0	4,231	3,020	24,184	17,107	15.66%
Uganda	0.06%	3	8	1	1,357	3,732	3.42%
Rwanda	0.21%	11	17	17	17	1,519	1.39%
Burundi	0.44%	23	21	36,	40	59	0.05%

other ESA (sub-Total)	93.7%	4,889	3,904	30,575	58,701	14,321	13.11%
Djibouti	1.94%	101	306	169	1,379	7,404	6.78%
Sudan	77.63%	4,050	2,383	30,314	56,822	4,313	3.95%
Ethiopia	13.32%	695	1,198	68	50	2,231	2.04%
Comoros	0.02%	1	1	8	284,	301	0.28%
Mauritius	0	0	0	0	13	45	0.04%
Madagascar	0.79%	41	8	12	149	23	0.02%
Seychelles	0.02%	1	5	4	3	3	0.003%
Eritrea	0	0	4	0	1	1	0.0009%

Source: EC, Market Access Data Base, https://madb.europa.eu/madb/statistical_form.htm

By far the most important market in the eastern and Southern African region in 2018 was South Africa, which accounted for almost 39% of EU sugar exports to the 16 ESA countries to which exports currently take place. In 2018 South Africa replaced Sudan as the leading ESA destination. In 2017 Sudan had taken almost 40% of EU sugar exports to ESA countries, before declining by over 92% in 2018 (2).

This may well in part be attributable to the drought conditions in Southern Africa, neighbouring Eswatini (Swaziland) and the Sudan. However, in terms of trade with South Africa it could also be attributable to specific patterns of sugar demand from the manufacturing sector.

The other noteworthy trend is the expansion of EU sugar exports to the EAC market, in the context of the continued application of safeguard measures by Kenya under the COMESA trade agreement. between the 2014-16 period and 2017//-18 period there was a more than 10-fold increase in the average volume of EU sugar exports to the EAC region, with Kenya in 2018 taking 49% of EU sugar exports to the EAC market (2).

EU sugar exports to other ESA countries however has proved highly variable with no clear trend, but a surprising rise in EU sugar exports to Ethiopia in 2018, though be it from a low base (2).

It is noteworthy that some of the largest increases in EU exports are in countries and sub-regions where EU based sugar companies have developed partnerships or enjoy major ownership stakes in local sugar producers, most notably in the EAC and SADC EPA regions (2).

Variable Trends in EU Exports to the Caribbean

Beyond Africa EU sugar exports to the Caribbean have increased marginally by 4.8%. This however has taken place on a highly variable trend. Exports to Haiti are a major determining factor in trends in EU sugar exports to the Caribbean ACP countries. In 2017 Haiti accounted for 60% of EU sugar exports to Caribbean ACP countries, with this falling to a mere 0.8% in 2018. Indeed the fall in EU sugar exports to the Caribbean ACP region was wholly accounted for by changes in export levels to Haiti (2).

The most consistent destination market for EU sugar exports over the past five years has been Barbados, though be it on a declining trend. Between 2014 and 2018 the volume of EU sugar exports to Barbados fell 19%, with the share of Barbados in EU sugar exports to the Caribbean ACP region falling from 74.5% in 2014 to 57.3% in 2018 (2).

Elsewhere in the Caribbean the most noticeable trend was the increase in EU sugar exports to Suriname, with these exports largely coming from the Netherlands and Belgium. In 2018 Suriname accounted for 36% of EU sugar exports to the Caribbean ACP region, up from 14% in 2014 (2).

EU Sugar Exports to Caribbean Countries (tonnes) % share exports to Caribbean ACP region

	% share 2014	2014	2015	2016	2017	2018	% share 2018
Caribbean		7,056	7,762	9,012	18,223	7,395
Barbados	74.50%	5,257	4,828	4,364	3,406	4,239	57.3%
Suriname	14.82%	1,046	1,368	1,324	2,912	2,665	36.04%
Bahamas	3.43%	242	198	242	198	220	2.97%
St Lucia	0	0	246	2,772	374	88	1.19%
DR	0.07%	5	34	38	55	67	0.91%
Haiti	0.03%	2	1	3	10,904	56	0.76%
St Vincent	0.31%	22	66	44	44	27	0.37%
Grenada	6.96%	484	621	225	330	22	0.30%
Jamaica	0	0	0	0	0	7	0.09%
Trinidad & Tobago	0	0	2	0	0	4	0.05%

Source: EC, Market Access Data Base, https://madb.europa.eu/madb/statistical_form.htm

EU Export Trends in 2019

Reduced EU production in the 2018/19 season has seen EU sugar export volumes for the 2018/19 marketing year down to just over half the level attained in 2017/18 over the same period (to 1,086,000 tonnes compared to 2,178,000). However these export volumes were still almost 73% above the levels attained during this period in 2016/17. Overall therefore EU sugar exports continue to be at enhanced levels (5).

Total EU Sugar Exports 2018/19 up to 21^st April 2019 (tonnes)

*Period*	2016/17	2017/18	2018/19
1^st Oct 2018to 21 April 2019	629,000	2,178,000	1,086,000

Source: EC, ‘EU Total exports – EU cumulated exports (CN 1701)’ Sugar Market situation, AGRI G 4 Committee for the Common Organisation of Agricultural Markets, 25 April 2019,
https://ec.europa.eu/agriculture/sites/agriculture/files/market-observatory/sugar/doc/market-situation_en.pdf

As the ACP Group has pointed out this has seen EU sugar suppliers taking market share away from ACP producers on regional ACP markets, compounding the earnings losses suffered as a result of substantially lower EU prices and ACP export volumes to Europe (6).

Comment and Analysis

While EU sugar exports to West Africa have seen a more than seven-fold increase since 2014, this trend has not been replicated in Nigeria. Current efforts by the Nigerian government to develop backward linkages in the sugar sector are actively discouraging imports of refined sugar and favouring imports of raw sugar, linked to commitments from refining companies to expand local sourcing of sugar cane.

This Nigerian government policy includes:

· the granting of ‘a five-year tax holiday for investors in the sugar value chain’;

· the imposition of ‘a 20% duty and 60% levy for imported refined sugar’;

· the imposition of a ‘10% import duty and 50 % levy on imported raw sugar’, but with a special three year dispensation during which a ‘concessionary tariff of a 5% import duty and 5% levy on imported raw sugar’ is granted to refineries that signed-on to the government’s Backward Integration Program (7).

This Nigerian government’s policy thus actively discourages the importation of refined sugar from regions like the EU and favours the importation of raw sugar, by refiners who have committed to local sourcing to greater local sourcing.

However as USDA analysis points out Nigerian government ‘policies on sugar have not resulted in increased production’. Indeed it is held the Nigerian governments ‘backward integration programs for sugar production still remain significantly challenged, due to weak infrastructure, poor policy formulation/implementation, limited funding and insecurity’ (7).

This creates a situation where according to USDA for ‘MY 2018/19 imports are forecast to remain relatively constant at 1.8 million tons’, while production continues to languish at a mere 80,000 tonnes (7).

Thus while the Nigerian governments policy has systematically discriminated against refined sugar imports from the EU and encouraged imports of raw sugar, this has so far seen no significant improvement in domestic sugar production. What it has seen is a fourfold increase in EU refined sugar exports to Benin and accusations of increased smuggling of refined sugar across the Benin-Nigeria border (4). Against this background were a ‘no deal’ Brexit to lead to a displacement of EU27 sugar exports to the UK to non-EU markets (EU27 sugar exports to the UK in MY 2017/18 amounted to 550,000 tonnes of white sugar – see epamonitoring.net article, ‘First Post Production Quota Year Shows Dramatic Changes on the EU Sugar Market’, 18 February 2019). The need to find markets for this displaced sugar without further undermining EU27 sugar markets could see the EC exerting pressure on ACP governments to abandon trade policies which are seen as discriminating against EU exports.

ACP governments will need to remain alert to the potential trade displacement effects of a ‘no-deal’ Brexit in the sugar sector in a context where the UK’s ‘no-deal’ Brexit temporary MFN tariff schedule would see high MFN duties applied on imports from EU27 member states, bringing this trade to a virtual standstill. This would leave EU sugar companies looking for alternative export markets equivalent to 90% of the total level of EU sugar exports to ACP markets in 2018.

The expansion of EU sugar exports to Central African countries like Angola potentially has implications for the intra-African sugar trade, with Angola being a natural market for South African, Eswatini (Swazi) and Zambian exports. Indeed, the regional marketing strategy adopted by Illovo owned Zambian Sugar may account for the more limited expansion of EU sugar exports to the DRC. Indeed, given the extent of EU corporate ownership and partnership arrangements in the Eastern and Southern African sugar sector, the pan-continental marketing strategies adopted by these Europe based sugar companies could have a significant bearing on sugar trade flows.

This will be complicated by a ‘no-deal’ Brexit, given the major role which the British company Associated British Foods plays in sugar production in Southern and Eastern Africa and the potential which the French sugar company Tereos has for redirecting sugar production from associated companies in Sub-Saharan Africa to serving UK markets under a ‘no-deal’ Brexit scenario, were current exports to the UK from their French operations to be disrupted.

Against this background governments of ACP sugar exporting countries will need to maintain a close eye on developments around the Brexit process and the market positioning strategies adopted by EU sugar companies, to ensure national sugar sector interests are protected.

While EU sugar exports to the ESA region appear to be weather related, it is unclear to what extent, having established a market presence in countries such as Namibia and Kenya; EU exporters will seek to maintain their market presence. The pressure to maintain a market presence is likely to intensify under a ‘no-deal’ Brexit scenario given the scale of the EU27 trade displacement in the sugar sector which would arise under the application of the UK’s proposed temporary MFN tariff schedule (see epamonitoring.net article, ‘The UK’s Proposed New MFN Tariff Regime: Protects ACP Interests in the Short Term But…..’, 14 March 2019). If EU sugar exporters seek to maintain their market presence this will reduce intra-regional trade opportunities for Eswatini (Swaziland) the traditional supplier of the Namibian market and a recent sugar exporter to Kenya.

Despite long standing efforts to revitalise the domestic sugar sector, the Kenyan government continues to apply safeguard measures in the sugar sector under the COMESA agreement (see epamonitoring.net, ‘EAC Sugar Sector Continues to Seek Protection and Effective Management of Sugar Imports’, 15 November 2018). This limits the level of sugar imports allowed under the COMESA agreement. However according to the USDA the top 5 sugar suppliers to the Kenyan market are: Brazil (377,349 tonnes – 48%); Thailand (111,065 tonnes – 14%); Egypt (a COMESA member 87,059 tonnes – 11%); India (84,817 tonnes – 11%); and Mauritius (a COMESA member, 78,463 – 10%). COMESA members thus account for only 21% of Kenyan imports from the top five sources of supply (8). In addition despite these import restrictions under the COMESA agreement imports from the EU have grown rapidly since 2014 (2).

This raises questions about the consistency of such imports with the extension of the special sugar sector safeguards under the COMESA agreement. This being noted the EU remains a minor player as a supplier of sugar to the Kenyan market, with EU exports consisting exclusively of refined sugar.

While these COMESA safeguard measures would appear to have a bearing on Swazi sugar exports to the Kenyan market, which totalled 66,475 tonnes in MY 2017/18, a more important factor was the lapsing of the special dispensation which Eswatini (Swaziland)was able to avail itself of under COMESA trade arrangements while still a member of the SACU. Given the failure of SACU to acceded to the COMESA trade protocol this special dispensation for Eswatini’s sugar exports lapsed during the MY 2018/19. This saw total Eswatini sugar exports to Kenya fall to 10,687 tonnes, a reduction of 84% (9).

Given efforts underway to create a pan-African Continental FTA, the issue of the impact of EU sugar exports to Sub-Saharan Africa on the development of intra-regional trade in sugar is only likely to gain in prominence. This will be particularly the case as production levels recover from recent drought affected levels in countries like Eswatini and South Africa.

New Tanzanian Air Link to UK Could Help Side Step No-Deal Brexit Threat to Horticulture Exports to UK Via the Netherlands

May 6, 2019April 10, 2019 epamonitoring

Summary
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May 2, 2019April 9, 2019 epamonitoring

Summary
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April 29, 2019June 4, 2019 epamonitoring

Summary
The EU’s list of high risk plants for which risk assessment and SPS certification will be a pre-requisite for trade to take place has been published alongside the procedures to be followed for securing SPS certification. These procedures are extensive and demanding. While few ACP products are affected by the current list, this list could be extended, with potentially a wide range of ACP exporters being affected. The length of notification before new requirements enter into force will be an important issue in trade with the EU in potentially affected products. Given the specific climatic conditions in the UK it is unclear whether under a no-deal Brexit scenario the UK would feel obliged to fully enforce all aspects of the EU’s new plant health regulation once its enters into legal effect in the EU in December 2019. Given the potential trade disruptions which could arise from the new EU plant health regulation it would appear important to ascertain from the UK government its future SPS related import control policy in areas of export interest to ACP countries. The reality is that given the agro-climatic conditions in the UK a range of EU regulatory requirements may simply be un-necessary under a purely nationally defined SPS control regime (e.g. strict CBS controls on citrus fruit imports). This issue should form an important part of any Continuity Agreement negotiations with the UK, particularly under the proposed “Annex of Concerns” approach. Read more “Stricter Risk Assessments under New EU Plant Health Regulation Could Hinder ACP Exports”

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April 25, 2019April 10, 2019 epamonitoring

Summary
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April 18, 2019March 31, 2019 epamonitoring

Summary
If the EU no longer carries out necessary phytosanitary checks on plants and plant products imported into the UK via EU27 member states, the UK will need to apply standard 3^rd country phytosanitary controls to ACP plant products exported to the UK via a EU27 member state. The application of standard 3rd country phytosanitary controls along ACP triangular supply chains could prove disruptive given the UK government’s current planned system of controls. These controls are seen as commercially non-viable by operators involve in current triangular supply chain arrangements. There is therefore an urgent need for ACP governments whose exporters are involved in triangular supply chains involving the affected products to secure from the EU authorities a firm commitment that necessary plant health checks on products destined for the UK market will continue to be carried out in the EU27. Read more “UK Procedures for SPS Inspections of Plant and Plant Products under a No-Deal Brexit”

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April 15, 2019April 11, 2019 epamonitoring

Summary
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April 11, 2019April 9, 2019 epamonitoring

Summary
Ecuador, Colombia and Peru are set to sign a Continuity Agreements with the UK, thereby ensuring continued reduced duty access to the UK market for their banana exporters. These Andean Pact countries accounted for 43.6% of UK banana imports and alongside the Continuity Agreement concluded with CARIFORUM countries ensures a continuation of current terms and conditions for banana imports which, in 2017 accounted for almost 64% of total UK banana extra-EU imports. This increases pressure on Ghana, Cameroon and Cote d’Ivoire to speedily conclude Continuity Agreements with the UK in the event of a no-deal Brexit. Any imposition of UK MFN tariffs would undermine the commercial position of African banana exporters, de facto amounting to a 15.4% import tax on bananas from the main African exporting countries. Read more “Pressure Mounts on Cameroon, Ghana and Cote d’Ivoire to Sign UK Continuity Agreements to Protect Banana Exporters”

South Africa to Take EU to WTO Dispute Settlement over Citrus Black Spot Controls

April 8, 2019March 28, 2019 epamonitoring

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”

How Would ACP Least Developed Countries Be Impacted by a 12th April No Deal Brexit?

April 4, 2019April 2, 2019 epamonitoring

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 3^rd 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 12^th 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 12^th 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?”