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Montevideo, June 26th 2022 - 23:41 UTC

 

 

UK/Brazil clash over an Expanded Trade Partnership; beef and other meats the stumbling barrier

Tuesday, February 15th 2022 - 09:22 UTC
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The main complaint of the Brazilian government is London’s refusal to include sanitary and phytosanitary measures on the table of discussions The main complaint of the Brazilian government is London’s refusal to include sanitary and phytosanitary measures on the table of discussions

Brazil has been reluctant to take forward negotiations for an Expanded Trade Partnership, ETP, with the UK since Brasilia claims that the terms offered were disappointing, and unbalanced since they only contemplated the interests of Britain, “ignoring Brazil's demand to increase its exports to the UK”.

Allegedly Brazil and its open markets' Economy minister Paulo Guedes has been eager to begin trade agreement negotiations with all possible countries, but objected since UK's team lacked the technical capabilities for such an undertaking and they also expressed uncertainty about Mercosur's future, given Argentina's attitude and the coming presidential election in Brazil.

London had previously envisioned announcing the negotiations on January 31st., but it has all been delayed.

In addition to simplifying customs procedures, which would be beneficial to both sides, other points suggested by the UK were: greater access to financial services and higher education; government procurement (including in public tenders); “life sciences,” a little-used term that refers to medicines and patents related to them.

The main complaint of the Brazilian government is London’s refusal to include sanitary and phytosanitary measures on the table of discussions. UK imports roughly 70% of the food it consumes. Half of that comes from its former EU partners.

Even with Brexit, these countries continue to have a zero rate to export to the British market. However, many producers in the EU have become so unaccustomed to customs procedures that they prefer not to deal with foreign trade bureaucracy, prompting them to stop exporting.

Brazilian producers have thus seen it as an opportunity to increase their share of the British market. Brazil already sells beef, fruits, nuts, juices, and roasted coffee to the UK. However, farmers face restrictive quotas to export chicken meat to UK, and there is no access for pork, fish, or dairy produce.

According to Itamaraty sources, what troubles the Brazilian government the most are the beef trade barriers. The British inherited EU rules, which Brasilia at the time deemed reasonable, given the complexity of designing a new trade scheme.. However, now that years have passed since Brexit, Itamaraty and the Ministry of Economy argue UK should abandon old rules and embrace modern sanitary measures.

Another complaint has to do with “pre-listing,” a system whereby a meatpacker receives immediate approval to export without the need for separate prior inspections. The EU had a pre-listing

system with Brazil, but it was suspended in 2017 due to Operation Carne Fraca.

Even though Europe kept the ban, the United Kingdom no longer has an obligation to follow this rule. Brazilians are also protesting that the UK scrutinizes all meat batches that arrive in the country on a sample-by-sample basis.

According to authorities in Brasilia, if an unbalanced ETP that only prioritizes British concerns is approved, UK would have no reason to negotiate a Free Trade Agreement in the future. There have also been complaints that, despite refusing to discuss agriculture with Brazil, London has signed a treaty with Australia and New Zealand, two major food producers, addressing these concerns.

On the other hand, the British maintain that they cannot negotiate sanitary and phytosanitary measures because an independent agency regulates them. They also mentioned the case of India, which had an ETP-type partnership with the United Kingdom and then began to negotiate a free trade format.

“There is enough room to move forward in the coming months, and Brazil should not see this as a zero-sum game. It’s just a start,” said a British source. A Brazilian source replied that Brazil is the largest economy in Latin America, and together with Mercosur country members, has a leading position in foreign trade.

Categories: Politics, Brazil, International.

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