Earlier this month the European Commission published its 4th Annual Report on the Implementation of the European Union’s Trade Agreements (which can be read here). The 2019 report shows that EU agri-food exports to trade partners increased by 8.7% compared to the previous year. Exports of agri-food products to Japan even rose by 16%, following the introduction of the EU-Japan FTA in February 2019. 

• The EU-Mercosur Trade Agreement, reached in 2019, faces increased opposition however as it heads for ratification. The agreement is soon to concluded its process of “legal scrubbing” and will then be presented to EU members states and the European Parliament for a vote of approval. However, at November’s Agriculture Council Meeting, Agricultural ministers from Austria, Bulgaria, Lithuania, Romania and Slovakia raised their opposition to the deal. It comes in addition to concerns raised by Ireland and France in previous meetings. The countries based their objection to the deal on sustainability grounds, with the Austrian agriculture minister stating that “for us, the highest environmental and climate protection standards are not negotiable … it cannot be the case that the agreement will lead to further deforestation of areas of the rainforest”.

• For EU-USA trade relations, expectations are up that a solution can soon be found to the on-going trade dispute which has seen additional tariffs of 25% placed on Irish dairy exports to the US, amongst other EU products, since October 2019. The dispute relates to a long-standing disagreement on air plane manufacturer subsidies. The incoming Biden administration, which will take office in January 2021, is considered to be more favourable to normalizing trade relations with the EU. Additionally, the EU now has leverage of its own to enter negotiation with- on November 10^th it applied additional tariffs worth $4billion on US exports to the EU, following authorization from the WTO. According to the Commission, the EU tariffs strictly mirror the measures taken by the US, with 50% of the value on aircraft imports, 25% on industrial goods and 25% on agri-food. The food products targeted include some cheese types including cheddar and well as sugar beet and molasses, the latter of which is largely imported by Ireland.

• On the other side of the world, one of the biggest trade deals ever seen has been reached by 15 Asia-Pacific nations, including China, Japan, South Korea, the 10 ASEAN countries of South East Asia, New Zealand and Australia – called the Regional Comprehensive Economic Partnership. While it will not lead to any major overall reduction in tariffs, the deal is still considered a major step forward for trade liberalisation in the region, as it will create unified rules of origin and replace a mishmash of bilateral trade deals which currently exist. This means it will be easier for these countries to build flexible supply chains across different states, bringing Asia a step closer to being a coherent trading zone like the EU or North America.

Alison Graham – EU Affairs Executive