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Thursday, 08 June 2017

Brexit risks disrupting EU agriculture market

EU farm and food businesses may pay a big price for Brexit if new trade barriers pop up and dim the British appetite for products like Irish cheddar, French wine and Danish bacon, experts and advocates warn. Sounding the alarm is the main European farmers' union, Copa-Cogeca, which released a preliminary 156-page report one month after Britain formally told Brussels in late March it will withdraw from the bloc. "Farmers should not have to pay the price of a political decision," Cogeca President Thomas Magnusson warned, referring to the risk of post-Brexit trade barriers like tariffs. Farmers in the remaining 27 European Union states could find it particularly hard to export to such an important market as Britain, a net importer, if London and Brussels fail to strike a post-Brexit free-trade deal. Prices could increase sharply if Britain leaves the customs union under a "hard" Brexit, something British Prime Minister Theresa May has not ruled out if she does not get the new trade terms she wants. British consumers would then likely buy fewer of the EU agriculture products they have become used to in the last four decades. Standing to lose the most, the report's authors warn, are producers of fruit, vegetables, beef, dairy products and wine -- which account for a large chunk of the 45 billion euros ($50 billion) in annual EU food and agriculture exports to the United Kingdom. The Copa-Cogeca said it "strongly hoped" that the European Commission, the EU executive, will include in its 2019 and 2020 budgets "adequate crisis management tools" to aid farmers hit by any negative consequences. With the rise of Britons consuming sophisticated specialty European products, Britain's exit from the bloc could also hit hard cheese and wine producers who have been granted Protected Geographic Indications.Agriculture ranks 17th in UK exports to the EU, far behind the automobile sector, while the UK is a net importer of EU agriculture products. Alan Matthews, a professor at Trinity College in the Irish capital Dublin, said Britain's trade position with the EU gives it "some bargaining power" entering the Brexit negotiations due to start after the June 8 British elections. "But there are other areas where the shoe is on the other foot," he said. New trade barriers would also hurt the 11 billion pounds ($14 billion) in annual UK agriculture exports to Europe, hitting mainstays like Scotch whisky and British lamb.

Source: Becorder