Trade

Australia’s ambitious goals in EU and UK trade negotiations

Beef Central, February 5, 2020

WITH the next round of trade negotiations with the European Union set to kick off in Canberra next week, the Australian red meat industry is maintaining high ambitions for trade reform in both the EU, and the newly-separated United Kingdom.

As with other free trade agreements the Australian Government has negotiated to date, liberalisation of restrictive market access arrangements remains the overwhelming priority of Australia’s EU/UK Red Meat Market Access Taskforce.

EU/UK Red Meat Market Taskforce chair, Andrew McDonald

The current Australia-EU FTA negotiations and the envisaged Australia-UK FTA negotiations provide this opportunity for trade reform.

EU/UK Red Meat Market Taskforce chair, Andrew McDonald, said Australia had a long history of trading with Europe, with the Australian red meat industry responding to European customer demand by developing dedicated supply chains, focused on meeting market-specific requirements.

Despite this focus, Australian red meat exports are constrained by the EU via disproportionately low volume import quotas and high above-quota tariffs. In terms of country-specific access, Australian exporters only have access to a 7150 tonne high-quality beef quota (with a 20pc in quota tariff) and a 19,186t combined sheepmeat/goatmeat quota (with zero in quota tariff).

“The opportunity presented by the A-EU FTA negotiations to modernise these access conditions and address the uneven playing field, especially in comparison to the preferential access other global red meat exporters have secured with the EU, is clearly worth pursuing,” Mr McDonald said.

The sixth round of A-EU FTA negotiations is scheduled to be held in Canberra from Monday, and this engagement is likely to facilitate further discussion on market access for goods.

“As Australia and the EU are like-minded partners, with a shared commitment to rules-based international trade and given an environment of ongoing global disruption, we encourage negotiators from both sides to set the benchmark when it comes to a comprehensive and ambitious FTA outcome,” Mr McDonald said.

UK new trade agreement target

For future trade arrangements with the UK, the red meat industry remains equally optimistic.

In 1973, when the UK joined the European Economic Community (later to become the European Union), Australian red meat exports to the UK fell substantially – with the UK succumbing to the EU’s low quota and high tariff import regime.

However, following the UK officially leaving the EU after 48 years of membership on 31 January, the UK is now able to commence trade discussions with other parties including Australia.

Although having formally left the EU, transition arrangements will apply for the remainder of this year, with Australia’s current beef and sheepmeat access to the EU (incorporating the UK) remaining unchanged. This is because the UK effectively remains inside the EU market and customs union for the remainder of 2020.

Over the next 11 months, the UK will no doubt be focused on securing a trade deal with the EU – but it is also able to commence, conclude, but not implement, other trade agreements, Mr McDonald said.

“Given Brexit has come to fruition and in anticipation of government mandates which will trigger the commencement of negotiations, our industry Taskforce will be ramping up its advocacy, in partnership with the Australian Government, in pursuit of a trade enhancing FTA with the UK,” he said.

The separate but parallel EU UK FTA negotiations have the potential to provide additional export opportunities for the Australian red meat industry, with large pools of consumers demanding high-quality imported beef and sheepmeat, which the Australian industry is perfectly positioned to supply.

AgForce Queensland chief executive Michael Guerin said the EU’s heavily protected and subsidised beef industry – which is largely a by-product of their dairy industry – was severely curtailing export opportunities for Australia’s cattle producers, who don’t enjoy the same benefits.

“Today, I stood shoulder-to-shoulder with the National Farmers Federation to tell the Federal Government that enough is enough, that this completely lopsided and unfair playing field with the EU has to be levelled,” Mr Guerin said.

“The EU is one of the biggest producers and largest consumers of red meat, but the fact their industry enjoys heavy subsidies and import protections gives them an incredibly unfair advantage.

“This international injustice has been hurting Queensland’s beef industry for decades.

“Cattle President Will Wilson and I spent an hour with Trade Minister Simon Birmingham this morning highlighting the importance of trade for farmers at the grass roots and outlining exactly what Queensland beef producers expect from the EU.

  • fair access to European consumers for our high quality, sustainable beef
  • fair trade rules, no more tariffs and quotas, just the same conditions European beef producers have to enter Australia, and
  • immediate action to protect our increasingly large and important Asia-Pacific markets from being flooded with highly subsidised, inferior quality red meat from the EU.

“We respect the negotiation process, we understand the EU is sensitive about agri-imports, and we stand willing to collaborate on a mutually beneficial solution.

“These trade conditions will last for decades. Our negotiators need to understand the future livelihood of many families living in our regions depends on it. That’s why we need a significant result and we need to get this right.

“The post-Brexit negotiations with the EU offer Australian producers a once-in-a-lifetime opportunity to significantly improve their access to world markets and they are ready to meet consumer demand.

“We don’t yet know the outcomes of our advocacy, but we will continue to push this issue hard on behalf of Queensland beef producers.

“We are hopeful that the results of our advocacy will be a proud legacy to leave our children as Australian agriculture sets its sights on a $100 million farmgate value by the end of this decade.”

 

Source: MLA, AgForce

 

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