Written answers

Thursday, 4 July 2019

Department of Agriculture, Food and the Marine

Trade Agreements

Photo of Brendan SmithBrendan Smith (Cavan-Monaghan, Fianna Fail)
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384. To ask the Minister for Agriculture, Food and the Marine if he has outlined clearly to the European Commission his opposition to the proposed Mercosur deal; the actions he plans to have the deal rejected; and if he will make a statement on the matter. [29019/19]

Photo of Brendan SmithBrendan Smith (Cavan-Monaghan, Fianna Fail)
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385. To ask the Minister for Agriculture, Food and the Marine the outcome of his most recent discussions with the EU Agriculture and Trade Commissioners in relation to the proposed Mercosur deal; if he has outlined clearly his opposition to such a deal due to the adverse impacts it will have on agriculture here; and if he will make a statement on the matter. [29020/19]

Photo of Michael CreedMichael Creed (Cork North West, Fine Gael)
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I propose to take Questions Nos. 384 and 385 together.

While as a small, open economy, Ireland is supportive of international trade deals, I am very concerned at the potential impact of elements of the EU-Mercosur political agreement on the Irish beef sector. Throughout the negotiation process, Ireland has consistently opposed any agreement that would have negative consequences for the Irish and EU agriculture sectors, and for the beef sector in particular.

We have worked closely with other Member States and the European Commission in this regard. As recently as 7 June 2019, I wrote to Commissioner Hogan reiterating our concerns. I also held a bilateral meeting with the Commissioner at the African Union-European Union Ministerial Conference in Rome on 21-22 June. Also in June, the Taoiseach, with the Heads of Government of France, Poland and Belgium, co-signed a letter to Commission President Jean-Claude Juncker expressing our deep concerns. Minister Heather Humphreys also formally wrote to Trade Commissioner Cecilia Malmstroem.

In all interactions, we have consistently highlighted Ireland's concerns, and while some evidence of these efforts appears to have been reflected in the final offer, I am, nonetheless, deeply concerned at the potential impact on the Irish beef sector.

We must acknowledge that there may be some opportunities for the Irish dairy sector and for the drinks industry, and we will, of course, examine the text carefully when it emerges in order to assess its impact on the Irish economy and on the agri-food sector generally.

It is also worth noting that this agreement will not come fully into effect for some years. It will first go through a process of legal scrubbing, which could take up to two years, before being put before the European Trade Council for ratification by Qualified Majority Vote, and the European Parliament. It may be provisionally applied but will take a further number of years before coming fully into effect. The Oireachtas and other national parliaments may also ultimately have a role in ratification.

We will also now reflect on the appropriate next steps in the context of both engaging further with Member State colleagues, and examining ways to diminish the potential impact of the agreement.

Photo of Charlie McConalogueCharlie McConalogue (Donegal, Fianna Fail)
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386. To ask the Minister for Agriculture, Food and the Marine the details of market access and removal of import and export tariffs or duties including the timeline for all agriculture items (details supplied) in relation to the agreement for an EU-Mercosur free trade deal by sector; if an impact assessment of the impact of the increased import quotas for all sensitive products into the EU from the deal including beef has been carried out; and if the interests of Ireland are protected and all available options considered in the ratification process to protect the livelihoods of farmers. [29033/19]

Photo of Michael CreedMichael Creed (Cork North West, Fine Gael)
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We are yet to see full texts of the agreement, but the main points that have been identified at this stage from an agriculture perspective are as follows:

For the Mercosur countries, the agreement will liberalise 91% of trade overall - 72% will be liberalised in 10 years or less. On agri-food trade, duties will be gradually eliminated on 93% of tariff lines concerning EU exports, corresponding to 95% of export values. Olive oil, malt, frozen potatoes, wine (except bulk), spirits, soft drinks, fresh fruit (kiwi, apples, pears, plums), canned tomatoes, chocolates and canned peaches will be fully liberalised. In addition, there will be duty-free quotas for EU exports of cheese (30 000 tonnes), milk powders (10 000 tonnes) and infant formula (5 000 tonnes). These will be phased-in in ten equal annual instalments from entry into force.

For the EU, the agreement will liberalise 92% of trade overall, of which 66% were already Most Favoured Nation (MFN) zero. On agri-food trade, EU will liberalise 82% of imports. There will be key quota volumes for sensitive products (all phased-in in six equal annual instalments unless otherwise stated):

- 99,000 tonnes CWE of beef, equivalent to 76,154 tonnes of cuts, subdivided into 55% fresh and 45% frozen with an in-quota rate of 7.5%, and elimination at entry into force of the in-quota rate in the Hilton quotas;

- 180,000 tonnes of poultry CWE duty free, subdivided into 50% bone-in and 50% boneless (boneless sub quota of 90,000 tonnes CWE equivalent to 64,286 of cuts).

- 25,000 tonnes of pigmeat, with an in-quota duty of €83 per tonne.

- no new volume of sugar for Brazil but rather the elimination at entry into force of the in-quota rate on 180,000 tonnes of the Brazil-specific WTO quota for sugar for refining, and a new quota of 10,000 tonnes duty free at entry into force for Paraguay. Specialty sugars excluded.

- for ethanol for chemical uses, 450,000 tonnes duty free. 200,000 tonnes of ethanol for all uses (including fuel), with in-quota rate 1/3 of MFN duty, giving a total of 650,000 tonnes.

- for rice, a quota of 60,000 tonnes duty free.

- for honey, a quota of 45,000 tonnes duty free.

The EU Commission will now commence the process with Mercosur of finalising the text of the agreement. The Deputy will be aware that the Taoiseach has already confirmed that a full economic assessment of the deal will be carried out, and my Department will feed into this work, with the assistance of Teagasc.

It is also worth noting that this agreement will not come fully into effect for some years. It will first go through a process of legal scrubbing, which could take up to two years, before being put before the European Trade Council for ratification by Qualified Majority Vote, and the European Parliament. It may be provisionally applied but will take a further number of years before coming fully into effect. The Oireachtas and other national parliaments may also ultimately have a role in ratification.

We will also now reflect on the appropriate next steps in the context of both engaging further with Member State colleagues, and examining ways to diminish the potential impact of the agreement.

Photo of Charlie McConalogueCharlie McConalogue (Donegal, Fianna Fail)
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387. To ask the Minister for Agriculture, Food and the Marine if the EU Commission has carried out an updated impact assessment following the 2016 European Commission report on the cumulative economic impact of future trade agreements on EU agriculture which was predicated on the UK remaining in the EU; if a new impact assessment will be carried out to provide for all Brexit scenarios; and the way in which 99,000 tonnes of increased Mercosur beef quota entering the EU would necessitate a new impact assessment to be completed. [29034/19]

Photo of Michael CreedMichael Creed (Cork North West, Fine Gael)
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The 2016 cumulative impact assessment, carried out by the European Commission's Joint Research Centre, was something that Ireland, supported by France and other Member States, had called for in the context of the significant threat presented to the European agriculture sector, and particularly the beef sector, by Mercosur and other free trade negotiations. The study outlined the potentially significant negative consequences for the European beef sector, and I believe it was not adequately taken into account in the course of the Mercosur negotiations. Therefore, I believe an updated analysis is warranted, particularly against the backdrop of the potentially very negative impact of Brexit on the beef sector.

In the meantime, I welcome the fact that a comprehensive economic impact assessment from an Irish perspective will be conducted, and my Department will participate fully in this process.

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