Time for EU to commit to a level playing field for trade

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The Dairy Companies Association of New Zealand (DCANZ) has welcomed New Zealand Trade Minister David Parker’s statement that it is unacceptable for New Zealand exporters to continue facing an ‘unlevel playing field’ in the EU.

Details leaked ahead of the 8th round of EU-NZ FTA negotiations have revealed the EU is seeking to maintain an extreme level of market access restriction against New Zealand dairy exports. The leaked EU market access offer comes despite both parties having committed to ‘work towards a deep, comprehensive, and high-quality Free Trade Agreement’.

DCANZ Chairman, Malcolm Bailey, says the reported EU offer, comprised of miniscule quota volumes and high in-quota tariffs, could never credibly form part of a free trade agreement between the economies.

“This falls short of even paying lip-serve to free trade. It is unashamed protectionism from the world’s largest dairy exporter” says Bailey.

The reported starting cheese quota of 1500 tonnes is less than a rounding error, at just 0.02% of the EU’s nearly nine million tonne cheese market. The butter offer of 600 tonnes is similarly low at just 0.03% of the domestic market, and each tonne will attract a tariff of Euro 586 per tonne, significantly constraining its usability.

“The only reason to maintain in-quota tariffs is to limit access whilst giving the appearance of providing it” says Bailey.

The EU’s ongoing agricultural protectionism is at odds with recent statements it has joined on the importance of maintaining open markets for food in the wake of COVID-19. It also ignores the UN Sustainable Development Goal target to correct and prevent restrictions and distortions in world agricultural markets.

DCANZ’s concerns are not limited to EU attempts to maintain trade prohibitive tariff protections. It is also alarmed at sweeping EU proposals to prevent New Zealand cheesemakers from using common cheese names such as gruyere, feta and parmesan. Adding insult to injury, EU dairy producers enjoy among the highest levels of trade distorting subsidies in the world – a practice that significantly disadvantages New Zealand exporters on the world market.

“This trade agreement is an opportunity for the EU to take real global leadership and send a positive signal for food trade. It’s time for action to match words” says Bailey.