Will the 🇬🇧 UK-Australia 🇦🇺 trade agrement do what has been claimed?
“British farmers will be protected by a cap on tariff-free imports for 15 years” the UK International Trade Department said.
A look at the details shows that is not quite true
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The detail shows that in only two cases (beef, sheepmeat) is the protection for 15 yrs, and even then the impact of a “cap” is not what it might seem at first sight. For rice, dairy products and sugar, the protection is for zero, five or eight years.
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To assess the impact, we need to look at
• the starting point (2021 tariffs and quotas)
• the size and expansion rate of the quotas
• how the in-quota tariff compares with the starting point
• what the out-of-quota or safeguard tariff is
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Beef
Year 1 sees a jump in the tariff quota. For years 11-15 the 20% “safeguard” duty effectively reduces the out-of-quota duty to the present in-quota rate: 20%
Since imports are possible at 20%, how much protection will that be?
Details here: tradebetablog.wordpress.com/2021/06/18/uk-…
4/10
Sheepmeat
The present tariff quota is zero for in-quota imports. The same question remains: how much protection will a 20% out-of-quota duty provide in years 11-15?
tradebetablog.wordpress.com/2021/06/18/uk-…
5/10
Sugar
It’s unclear whether the present tariff quota for raw cane sugar will be changed to cover other types of sugar. In any case the quota leaps in year 1, and is replaced completely by duty-free trade after 8 years
tradebetablog.wordpress.com/2021/06/18/uk-…
6/10
Rice
tradebetablog.wordpress.com/2021/06/18/uk-…
Short/medium grain rice is totally duty-free immediately
Long grain has a new permanent tariff quota of 1,000 tonnes
(Note this seems to be about protecting UK rice mills)
7/10
Dairy (cheese)
There is no UK cheese quota for Australia alone, only for all non-EU countries. Year 1 Australia gets quite a large tariff quota, growing for 5 years, then totally duty-free.
Details: tradebetablog.wordpress.com/2021/06/18/uk-…
8/10
Non-cheese dairy
• Butter: No quota now. A new tariff quota growing over 5 years. Totally duty-free imports from year 6.
• Other non-cheese dairy (what does that include?): a new 20,000 tariff quota also for 5 years, duty-free from year 6
tradebetablog.wordpress.com/2021/06/18/uk-…
9/10
Plus a bit of trade-illiteracy
The UK International Trade Department’s press release claims “red tape and bureaucracy will be torn down”.
This is pure fantasy and no credit to a government department dealing with trade.
See ⬇️
tradebetablog.wordpress.com/2021/06/18/uk-…
10/10
UPDATE: I’ve now uploaded the file I used to match product codes in the UK’s tariff quotas with product names. It was a complicated task, and no doubt there are still mistakes.
The blog post now includes the disclaimer buried at the bottom of the text.
tradebetablog.wordpress.com/2021/06/18/uk-…
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