Commission study finds positive impact of trade agreements on agri-food sectors

(Credit: Unsplash)

This article is brought to you in association with the European Commission.

The EU trade agenda is set to have an overall positive impact on the EU economy and the agri-food sector, according to a new study published today. Trade agreements are due to result in substantial increases in EU agri-food exports, with more limited increases in imports, creating a positive trade balance overall. The study also confirms that the EU’s approach to grant a limited amount of lower duty imports (through tariff rate quotas) is the best approach in terms of protecting specific vulnerable agri-food sectors in the EU.

The study carried out by the Commission’s Joint Research Centre (JRC) covers the cumulative effects of 12 trade agreements on the agri-food sector by 2030, an update of a 2016 study. A theoretical modelling exercise, the study includes trade results for the agricultural sector as a whole, and sector-specific impacts on trade, producer prices and production volumes.

Commenting on the study, Executive Vice-President responsible for trade Valdis Dombrovskis said: “The EU has always stood for open and fair trade which has enormously benefitted our economy, including agricultural producers. This study shows that we have been able to strike the right balance between offering more export opportunities to EU farmers, while protecting them from potential harmful effects of increased imports. Supporting the EU agri-food sector will continue to be a key element of the EU’s trade policy, be it through market opening, protecting traditional EU food products or defending it against dumping or other forms of unfair trade.”

Agriculture Commissioner Janusz Wojciechowski said: The success of EU agricultural trade reflects the competitiveness of our sector. Reforms of the Common Agricultural Policy have highly contributed to this, supported by a global reputation of EU products as being safe, sustainably produced, nutritious and of high quality. This study, with more positive results than in 2016, confirms that our ambitious trade agenda helps EU farmers and food producers take full advantage of opportunities abroad while making sure we have sufficient safeguards in place for the most sensitive sectors.

The study covers free trade agreements (FTAs) recently concluded or implemented by the EU, as well as trade agreements on the EU agenda. It includes two scenarios, an ambitious one (full tariff liberalisation of 98.5% of all products, and a partial tariff cut of 50% for the remaining products) and a more conservative one (full liberalisation of 97%, and 25% tariff cut for the others). In addition, included in the scenarios, the five concluded FTAs are modelled on the basis of the negotiated outcome. The results of the scenarios are both compared to a reference scenario of business as usual in 2030. Environmental and climate effects do not fall within the scope of today’s study, including any Green Deal related initiatives. The Sustainability Impact Assessments prepared in support of trade negotiations already provide the Commission with an in-depth analysis of the potential economic, social, human rights, and environmental impacts .

Main findings

Throughout the study, findings are for 2030, with the different scenarios compared to the reference scenario of business as usual.

For both scenarios, the results show a positive impact on the EU agri-food trade balance by 2030. While EU trade partners gain market access in the EU, it also allows EU exports to grow significantly. EU agri-food exports to the 12 FTA partners are set to increase by 25% (conservative scenario) and by 29% (ambitious scenario), while imports increase by 10% (conservative) and by 13% (ambitious), both compared to the reference scenario. This corresponds to the EU total agri-food exports increasing by €4.7 billion (conservative) and by €5.5 billion (ambitious), and total agri-food imports by €3.7 billion (conservative) and €4.7 billion (ambitious).

The study confirms that the EU agricultural sector can benefit from the EU trade agenda. A comparison of the 2016 versus 2021 cumulative impact studies shows the effectiveness of tariff rate quotas in mitigating impacts on our sensitive sectors such as beef, rice or sugar. In fact, the 2016 study already informed the strategy towards Mercosur and this update can be used as an evidence base for the need for Tariff Rate Quotas in ongoing trade negotiations. Furthermore, an ambitious future Common Agriculture Policy, supporting innovation, sustainability and the competitiveness of the EU farming sector, can also contribute to minimise any negative outcomes of trade negotiations while reinforcing the positive ones.

More details on the economic assessment is available in the study, including information about the methodology and caveats.

The outcome of the study was presented yesterday to EU Ministers at the AGRIFISH Council and presented today at the European Parliament’s Committee on Agriculture and rural development.

the sting Milestones

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Commission presents guidance to strengthen the Code of Practice on Disinformation

Unemployment and immigrants haunt the EU; who can offer relief?

UN agency chiefs issue ‘call to action’ on behalf of refugee children

Why are Black people in the UK more at risk from COVID-19?

Empathic AI could be the next stage in human evolution – if we get it right

Climate change and health: public health awareness in an international framework

Syrian crisis: €5.3 billion mobilised by donors for 2021 and beyond at 5th Brussels Conference

With the right leadership, sustainable finance can help us shift to a low-carbon economy

Access still an obstacle to reaching stricken communities on Indonesian island: UN agencies

How the EU’s new data-sharing strategy could benefit companies

Human rights breaches in Nigeria and Burundi

Commission presents far-reaching anti-tax evasion measures

Why we need a Paris Agreement for nature

Successful third issuance of EU SURE bonds by the European Commission

Statement by Frans Timmermans, Executive Vice-President for the European Green Deal, on the announcement to postpone the COP26

3 things to know about the fight against Alzheimer’s

Scores killed in ‘barbaric’ attack on Mali village, UN chief urges restraint, calls for ‘dialogue’ to resolve tensions

Business leaders must now turn positive ESG talk into long-term results

UN chief praises Africa for keeping ‘hearts and borders open’ in refugee crisis

Charges against Baha’i in Yemen must be dropped: UN experts urge release of detainees

Companies can help solve water scarcity. Here’s how

Is the ECB ready to flood Eurozone with freshly printed money?

West Darfur tensions could see 30,000 flee across Sudanese border to Chad: UN refugee agency

Ebola outbreak in DR Congo conflict zone ‘remains dangerous and unpredictable’ – UN chiefs

These Harvard scientists think we’ll have to socially distance until 2022

How Europe’s science offers hope in tackling the climate emergency

Cybersecurity Act: build trust in digital technologies

COVID 19 and the consequences in the fight against HIV

Aviation Safety: Commission adopts new EU Air Safety List

Investing in working conditions and quality jobs

How income-sharing agreements can improve access to education

Climate emergency: City mayors are ‘world’s first responders’, says UN chief

Historian Niall Ferguson on what the pandemic means for the global economy, geopolitics – and parties

The 8 pieces of digital DNA we need to thrive in the AI age

Decade ending 2019 likely to be hottest on record

Vĕra Jourová, European Commissioner in charge of Justice

The New EU-US “Shield” for data privacy is full of holes

3 things to know about our Sustainable Development Impact Summit

A fundamental transport transformation: Commission presents its plan for green, smart and affordable mobility

World must do more to tackle ‘shadowy’ mercenary activities undermining stability in Africa, says UN chief

Where EU air pollution is deadliest

It’s not summer holidays what lead to the bad August of the German economy

How people without running water can wash their hands

Pharmaceuticals spend millions to push TTIP while consumer groups spend peanuts

Team Europe launches new financing platform to support health security and resilience in Africa

4 key steps to support cross-border payments and digital trade growth

Nicaragua: MEPs demand an end to repression of political opponents

Why schools should teach the curriculum of the future, not the past

This unique, 20-year study followed the lives of 12,000 children in the developing world. Here’s what it discovered

The New Year 2016 will not be benevolent to Europe

Do not take the EP’s consent on MFF for granted, says Budget Committee Chair

Why 2020 is a turning point for cybersecurity

EU budget: Commission takes steps to make €11.5 billion available for crisis repair and recovery in 2020

Currency Union might not let an independent Scotland join the EU as the “Yes” front now leads

The EU Commission predicts a decimated growth in the next years

Human Rights and Democracy: striving for dignity and equality around the world

5 times people predicted the future and got it really wrong

MEPs adopted measures to reconcile work and family life

LGBTQI+ and medicine: are we prepared to deliver dignified and non-discriminatory health care?

We need to build a quantum security coalition. Here’s why

Recovery and Resilience Facility: Cyprus submits official recovery and resilience plan

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s