Freshfel Europe calls for EU and UK negotiators not to let the fresh fruit and vegetables sector down and to allow businesses to recover after COVID-19 before major changes are implemented for operators in EU-UK trade. This can only be secured by genuine technical progress in negotiations, leaving aside ‘political posturing’. In addition, a commitment is needed from both sides to clarify ‘no deal’ trading conditions and temporary arrangements similar to those announced in 2019 by the end of summer at the latest in order to ensure some certainty for businesses in case they have to face a worst case scenario.
Freshfel Europe supports the commitment of both EU and UK negotiators to continue negotiations towards a new ambitious partnership despite the challenging context of COVID-19 and to intensify talks in the coming months to ratify an agreement before the end of 2020 as expressed in Monday’s High Level Meeting. However, the sector remains deeply concerned about the limited amount of time left to reach a balanced EU-UK agreement to secure the continuation of long-established trade flows between the two blocs. As 1 January 2021 draws nearer, the long-feared ‘no deal’ scenario is looming. As a major threat itself to the European fresh produce sector*, further coupled with the COVID-19 pandemic, it will amount to a perfect storm, which the sector may not be able to weather.
Securing a continuous supply fresh fruit and vegetables to European citizens during the COVID-19 pandemic has not only been challenging but highly costly for the fresh produce sector. At the end of this year many operators will already be in a highly fragile financial situation and will be unable to carry further costs increases as a result of a second dramatic change in operations in less than 12 months. The recently announced UK Global Tariff (from 1 January 2021) will already affect some major agriculture products. Moreover, with the COVID-19 pandemic occupying the sector’s resources there will be extremely limited capacity to prepare for the new ‘hard’ Brexit conditions and procedures, especially if they are left open until the end of negotiations as historically commonplace.
Freshfel Europe urges EU and UK negotiators to focus on finding feasible technical solutions to prevent a ‘cliff-edge’ scenario at all costs in order to avoid extra administrative burdens and checks. Without an extension of the transition period, this could be achieved by implementing temporary arrangements for trade facilitation on both sides, such as the ‘preparedness’ measures, which were planned for a ‘no deal scenario’ in 2019. This would secure some business continuity while operators recover from the pandemic impact. The announcement by the UK on 12 June of a ‘staged approach’ to the re-introduction of border controls for EU imports in 2021 does bring more clarity, but there is an urgent need for more action from both sides. The EU and UK’s approach to trading conditions on day one of a ‘no deal’ scenario should be clearly communicated to all operators by the end of the summer at the latest. This is a basic need for business continuity and sustainability on both sides of the channel and should not be hostage to political discussions and trade-offs.
*Information on trading challenges due to Brexit for the EU and UK:
For EU fresh fruit and vegetable exporters, Brexit means a 60% increase in international exports from around 5 to 8 million tonnes. For the UK-based industry, Brexit will double volumes of fresh produce imported into the country. It should also not be forgotten that customs burdens will mostly be borne by small and medium sized companies with limited or no experience with custom operations.
Note to the Editors:
Freshfel Europe is the European Fresh Produce Association, representing the interests of the fresh fruit and vegetables supply chain in Europe and beyond. Freshfel Europe currently has over 200 members, including both companies and associations. For more information contact the Association at email@example.com or visit the association website www.freshfel.org.