Trade (Chap 4)

Free Traders

Doing Deals - WTO

Doing Deals Elsewhere

Food Futures Markets, E-Food Trading

Free Traders

Wetherspoon's beer mat manifesto The boss says: “there is absolutely no doubt that food prices will be cheaper without a deal, if the UK chooses the free trade option..to do away with tariffs would make food cheaper." Do away with Tariffs to make food cheaper says leading right wing 'think tank'. This all sounds like a major replay of the 'Corn Laws' (p13 in Book) - only for 2,000 agricultural products and 15,000 Processed Agricultural products (PAPs).

A major push by 'Free traders' among the Brexiteers is for us to go round the world 'doing deals' to avoid paying taxes on goods - either coming in or going out. The main thrust for these deals are not to sell our foodstuffs, but sell our financial services and white goods. The other partner in these deals will usually want to sell us food - without taxes.

Doing Deals

It is unclear yet as to the basis of the UK in these deals. We have to extricate ourselves from the EU first, and then find out what the terms of our membership with the WTO are before making any deal.

UK Parliament Inquiry: Brexit: Trade In Food Gove & Eustace session (Impact assessments 10.30-35, CAP 10.35-40, Standards 10.40-50, Information 10.50, Standards 11.00 Irish Border 11.05 - Wales, Full Alignment 11.20, Canada +++ 11.25, all sectors treated same? 11.30, Tariffs? 11.35-11.44, Fish transition 11.45-11.59 inc. no trade barriers during transition 11.56, Labeling 11.59-01. Standards & Residues 12.00-04

See Book Chapter 4 for background to this page #bittersweetbrexit

UK-US Deal

Opinion on UK-US trade relations inquiry. See Trump & Trade for details

Liam Fox's Department of International Trade agreed to talks being kept secret and "signed agreements with the US which will make it much more difficult to find out what is being discussed in early-stage US-UK trade talks. There is a joint working group mapping out the groundwork. Fox’s department formally agreed to tighten the rules on information handling two days after the trade secretary made a public pledge to boost transparency during the talks. "

Other possible UK trade deals!

Liam Fox is hiring expensive 'Trade Commissioners' - rather than using existing Ambassadors. We hear a lot about playing to WTO rules. That is fine. Except for one thing. To play the rules you have to be in the club. The UK is not yet a member of the WTO. We have to apply, and the head of the WTO said it could take years - see book for details, which also examines the priority countries to do free trade deals. And all possible partners round the world will be waiting to see what deal we make with the EU. Nevertheless, the most touted deal is that between UK and US.

Post Brexit possible agricultural Trade Deals

China/Commonwealth

Other EU Deals

EU-Japan. While we are doing a deal with the EU and others, the EU has just done a deal with Japan that will cover 600m people and around 30% of global GDP. Dubbed 'cars-for-cheese' deal the EU slashes import taxes on cars, while Japan reduces tariffs on dairy products, wine and meat. After 4 years and 18 rounds of negotiation, It will come into final effect, at the same time as we Brexit - March 2019.

EU-Mercosur ('Southern Common Market' - most of S.America). Irish Farm President says EU Commisioner cannot agree bad deal for EU farmers, calling on her to "reject the environmental destruction, failures on food safety and animal welfare, and slave labour associated with Brazilian beef". "Concerns over beef, ethanol, sugar and poultry were mentioned in letter to EU, which cautioned against the quotas on the table (beef 70,000 tonnes - down from 100,000, ethanol 600,000t) and signed by Austria, Belgium, France, Hungary, Ireland, Lithuania, Luxembourg, Romania, Poland, Slovakia, and Slovenia. The European Commissioner for Trade Celia Malmstrom is pressing for a deal - that has been ongoing for nearly 20 years. Mercosur want capacity to export more beef in particular in return for reducing taxes on imports from EU - like machinery, pharmaceuticals, and electronics. This is an example of exactly the sort of trade deals we are going to have to make in the future.

Food Chain Disruption

EU Consultation on making Food Chain Fairer

The British Retail Consortium (BRC) has said this could translate into a minimum 9% rise in the cost of tomatoes, 5% for cheddar and 5% for beef, while warning the figures could actually be much higher.

The BRC recently published research on the subject, acknowledges forecasting the consequent impact on food costs is complex and a range of other factors would have to be taken into account.