Food and agriculture: UK considers lower tariffs for higher standards

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Hello from Brussels. Passionate about global and vaccine-related issues, we are now catching up with local news, especially the trade deals being negotiated between the UK and Australia. A safe break In the EU position on agriculture which it inherited (despite us) Goding, We do not claim credit) And for over 15 years, we have responded to Australia’s demand to reduce tariffs on farms to zero. Wait a minute, you say, the UK government has promised to protect its sensitive sector to farmers. From now on, these peasants can join the crowded enclosure “Boris Johnson should not have trusted” in the British. Fishery, Business North Ireland, The company to deal with Technical barriers When exporting to the EU and a lot of political and personal knowledge. Literally decades Warning. Someone else about that Apparently yesterday.

In the context of its trade between the UK and Australia, much of the news focuses on the often misunderstood issue of food and agricultural standards. Chartered waters We will come back to how the “Phase 1” transactions between the United States and China are proceeding without the crisis in the manufacturing industry due to the pandemic.

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A stadium where Britain is difficult to level

This is a category that we analyze the UK take on Australia’s bilateral deal, which is not part of the spectacular Yose scene of global UK free trade, singing and dancing it all, but mainly as an economic project. I realize this is a mistake. However, since it is our brand that carefully ignores entertainment and pays attention to detail, we will bow.

Some Brexitters are now happily wondering what they signed up for, I am complaining The UK is trying to sell farmers by allowing them to fall below the norm. Australian agriculture uses processes and techniques (export of live animals, herbicides such as paraquat) to produce products that are banned or phased out in the UK (old chemically washed chicken and hormone beef). You certainly have the right to do so. The UK government has reportedly countered this by proposing that the zero tariff system be available only for products that meet UK agricultural standards.

There is a mess here that needs to be sorted out. From a standard point of view, Australian trade is less of a concern than critics think. However, the UK government’s obvious solution doesn’t make much of a difference in the face of the challenges it poses.

First, chemical chicken and hormonal beef are a bit of red herring, if you allow the mixed cooking metaphor. Food security is “Hygiene and phytosanitary(SPS) states that under World Trade Organization rules, any country can demand all agricultural products sold in its market as long as those standards are based on accepted science. This is not a trivial condition: the United States has won WTO case Opposing the EU’s 1997 ban on hormonal beef, Brussels had to acquire the US by launching a new import quota for non-hormonal beef. However, signing a trade deal with Australia does not automatically force the UK to accept hormone-boosted beef or chemically washed chicken. UK SPS rules will continue to apply unless you choose to change. In fact, the same is true of the very strict SPS measures for products such as Australian pork. Without hormones The beef sector with new access to the UK market.

The tricky issue is forcing foreign agricultural exporters to meet broader animal welfare or environmental standards.Manufacturing process and method“. The standards here are difficult to justify under WTO rules as they are vulnerable to abuse of protective trade principles, but by writing them into bilateral or regional trade agreements, higher welfare or more of sustainability We may offer lower prices on prospective products. There are precedents here. Switzerland has a trade agreement with Indonesia, prioritizing palm oil. Certified sustainable: The EU project with the Mercosur block in South America does the same for eggs laid by Brazilian hens benefiting from welfare at European level. Administratively, this is a bit boring, but it is not impossible, as exporters have to separate different lots of the same product under a single tariff classification.

So are Australian exporters up to UK standards, leveling the competition and all is well? Hmm. It is not clear if there will be much leveling. Show UK consumers a photo of a sprawling Australian feedlot under the blazing sun. It looks quite difficult compared to the fairy-tale images of the happy Mukau children mowing the grass on a farm in Cheshire. But try to write a deal that places high standards on imports. I don’t know how that makes a big difference.

British and Australian officials have stressed that Australian agriculture is not an area of ​​illegal atrocities. Last report On Australian agriculture, he said animal welfare standards were not well regulated (set at state level rather than national level), but veterinary standards were generally high.

Most of the different standards will not make any difference in preferential trade with Great Britain. Australia usually has looser rules for transporting live animals, but they never send live animals to the UK anyway. Most Australian states allow pig farmers to use ‘sow stalls’ which keep pregnant sows in small pens, but sell pork in the UK even at zero tariffs. Will not be competitive enough. In Australia, there is a widely criticized practice called “mulesing”. It cuts a patch of skin on the backs of sheep to prevent parasites, but is almost exclusively used by Merino sheep raised for wool. Zero tariffMany Australian politicians Maintain forest cover With Climate science, But it is not directly related to a particular export.

British farm lobbies have complained that such practices have helped Australian agriculture become a globally competitive superpower with no particular reduction in the costs of exporting to the UK. I go. However, Nick von Westenholtz, director of trade and trade strategy for the UK National Farmers Union, admits: “Australian farming can be based on very different values ​​than most UK farms when it comes to farming. ‘it’s about issues like animal welfare and the environment, but it’s not easy to turn around. It is embodied in a specific set of standards that the UK may require in return for extensive market access. ”

There are pitfalls: As many have pointed out, Australia is a mid-sized country halfway around the world, but their cows Not small, but far – Trading can set an important precedent. If the UK wants to follow different tariff paths on imports of higher standards, it may find itself in a series of difficult conversations about what exactly those standards mean. American agricultural lobby If a UK-US trade deal comes up.

If not a British peasant, Britain may have found a way to sell Australian deals to the skeptical masses. However, there may be more difficult conversations in the future. It’s a show with more action going on.

Chartered waters

Chad Bown of the Peterson Institute for International Economics did an excellent job of determining whether the Phase 1 deal Washington had with Beijing during the Trump era met expectations. The main expectation is that China has agreed to increase the purchase of certain US goods and services from the 2017 level of $ 200 billion between January 1, 2020 and December 31, 2021. ..

In 2020, US exports to China were modest and trade inadequate. 58 percent Where they should have been. Of course, there was a somewhat compelling excuse for the pandemic that closed factories around the world in the spring.

So what’s going on with this year’s trade now that exports are back on track? Not good.

According to the chart, US exports to China that are the subject of this transaction are only 60% of what they should be. If global trade is booming but they are still in short supply, we are certainly very skeptical that they will meet their targets by the end of the year. Claire Jones

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