EU-US Trade Agreement Imposes 15% Tariff While Protecting European Agriculture
Sourse: dairynews.today
A new trade agreement between the EU and the US sets a 15% tariff on certain goods, implementing strategic exemptions for sensitive agricultural products while engaging in energy and defense procurement agreements.
The European Union (EU) has accepted a fixed 15% tariff from August 1, with strategic exemptions for sensitive agricultural products, while agreeing on energy and defense purchases. Negotiations between the European Union and the United States aim to establish a trade framework that boosts the agricultural sector, presenting both opportunities and challenges.
The new trade agreement between the EU and the US, which focuses particularly on agriculture, promises to reshape trade relations in one of the most strategic segments of the global economy, potentially opening new horizons for food production, exports, and the competitiveness of the agro-industries in both blocs. The agreement seeks to remove tariff and non-tariff barriers, facilitating the exchange of agricultural products and dairy, among others.
Potential Benefits for Producers and the Agri-food Industry
The establishment of a trade agreement between the EU and the US could bring significant benefits to producers and the agri-food industry. New markets would open for agricultural products on both sides, potentially boosting the production growth and profitability of farmers and other primary producers. For the dairy industry, for instance, increased access to markets could mean a rise in exports of powdered milk, cheeses, and other dairy derivatives, diversifying destinations and strengthening income.
Challenges and Sensitivities in Agricultural Negotiations
Despite potential benefits, agricultural negotiations remain complex and sensitive in any trade agreement. Both the EU and the US have highly developed and protected agrarian policies, with differing sanitary, phytosanitary regulations, and subsidies. The elimination of tariffs and harmonization of standards might face resistance from some productive sectors fearing increased competition. The case of Nestlé, and the tariffs affecting its global profits, as well as discussions in the WTO, reflect these dynamics' complexity.
Impact on the Global Food Value Chain
The scope of this trade agreement will extend throughout the global food value chain. Greater trade liberalization between two of the world's largest economies could influence international agricultural commodity prices, investment decisions of multinational food companies (like Danone and Lactalis), and the reconfiguration of supply chains. For countries such as Argentina, Chile, and Uruguay, major exporters of dairy and other agricultural products, the implications could be significant, creating new opportunities or competitive challenges.
A Step Towards a More Integrated Global Market
This trade agreement represents a step towards the consolidation of a more integrated and transparent global market. Although negotiations will be arduous, the commitment of the EU and the US to progress on this front indicates a willingness to strengthen bilateral economic relations and lay the groundwork for smoother agricultural trade. The outcome of these discussions will be crucial for the future of the agro-industry worldwide and the definition of new food production and consumption poles.
The new trade agreement between the EU and the US, which focuses particularly on agriculture, promises to reshape trade relations in one of the most strategic segments of the global economy, potentially opening new horizons for food production, exports, and the competitiveness of the agro-industries in both blocs. The agreement seeks to remove tariff and non-tariff barriers, facilitating the exchange of agricultural products and dairy, among others.
Potential Benefits for Producers and the Agri-food Industry
The establishment of a trade agreement between the EU and the US could bring significant benefits to producers and the agri-food industry. New markets would open for agricultural products on both sides, potentially boosting the production growth and profitability of farmers and other primary producers. For the dairy industry, for instance, increased access to markets could mean a rise in exports of powdered milk, cheeses, and other dairy derivatives, diversifying destinations and strengthening income.
Challenges and Sensitivities in Agricultural Negotiations
Despite potential benefits, agricultural negotiations remain complex and sensitive in any trade agreement. Both the EU and the US have highly developed and protected agrarian policies, with differing sanitary, phytosanitary regulations, and subsidies. The elimination of tariffs and harmonization of standards might face resistance from some productive sectors fearing increased competition. The case of Nestlé, and the tariffs affecting its global profits, as well as discussions in the WTO, reflect these dynamics' complexity.
Impact on the Global Food Value Chain
The scope of this trade agreement will extend throughout the global food value chain. Greater trade liberalization between two of the world's largest economies could influence international agricultural commodity prices, investment decisions of multinational food companies (like Danone and Lactalis), and the reconfiguration of supply chains. For countries such as Argentina, Chile, and Uruguay, major exporters of dairy and other agricultural products, the implications could be significant, creating new opportunities or competitive challenges.
A Step Towards a More Integrated Global Market
This trade agreement represents a step towards the consolidation of a more integrated and transparent global market. Although negotiations will be arduous, the commitment of the EU and the US to progress on this front indicates a willingness to strengthen bilateral economic relations and lay the groundwork for smoother agricultural trade. The outcome of these discussions will be crucial for the future of the agro-industry worldwide and the definition of new food production and consumption poles.
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