Free trade with Europe will not be entirely free - Next hurdle: Non-tariff barriers

04 April 2008 - John Meyer Jr.

Europe's opening of its markets to Caribbean products will not mean automatic access to store shelves, according to a trade official who warned in Kingston this week that food exports would still have to hurdle non-tariff barriers.

Producers will have to satisfy the European Union trade bloc that their shipments meet established standards that countries use as a benchmark for quality.

Lincoln Price, the private sector liaison at the Caribbean Regional Negotiating Machinery (CRNM), speaking at an agribusiness project launch Monday, said some of these conditions were 'burdensome and dense', often requiring that producers follow strict compliance procedures.

In that vein, he said, it was in the interest of farmers, agro-processors and exporters to educate themselves on the non-tariff barriers peculiar to their target export markets.

Jamaica's agriculture minister, Dr Christopher Tufton, acknowledged the issue as a political reality, but said exporters can overcome the barriers by being smart.

"Trade is not as free as we think it is," said Tufton.

"There may be rules that govern barriers as it relates to tariffs, taxes, duties and so on. But when it comes to non-tariff barriers - phytosanitary and sanitary conditions - that is where Jamaicans encounter serious problems."

Surmounting barriers

Surmounting the barriers, he adds, requires businesses to develop their intellectual capacity; to understand what is at play in order to surmount blockades.

"As a government, we are going to have to increase our efforts to work with entrepreneurs so that they can adjust to understanding individual markets because every market has it own sets of unique features," he said.

"We can only take advantage of the opportunities now if we develop the intellectual capacity to understand how markets operate in terms of non-tariff issues."

Agribusiness exports have duty-free access into the United States under the Caribbean Basin Economic Recovery Act and the Caribbean Basin Trade Preference Act jointly called the CBI (Caribbean Basin Initiative), as well as into Canada under the CaribCan Agreement.

Still: "SPS - sanitary and phytosanitary - measures continue to complicate the agricultural trade regime," said Price at the launch of the Caribbean Agri-Business Association (CABA) Multilateral Investment Fund project in New Kingston on Monday.

Prior licensing

Similarly, the trade pact with Colombia guarantees access to Caricom goods, but strict food regulations dictate that traders must obtain prior licensing for the importation of all processed food for human consumption and a sanitary registration must be done before any of the products can be placed on the market there.

And traders of unprocessed foods must first obtain a sanitary import permit before an application can be made for an import licence.

In the case of the Dominican Republic, Caricom food products must first pass tests outlined in local food regulations before they are allowed to enter the Spanish-speaking Caribbean island, a condition outside of the trade agreement between the two.

Price said there was also a one-way bilateral trade agreement with Venezuela, but importers of processed and unprocessed food products are required to get sanitary health permits prior to import, as well as an import licence for certain groups of food products, such as meat, fish, crustaceans, molluscs, products of animal origin, prepared seafood and meats, cereals including rice, and processed vegetables and sauces.

But Price also said intra-Caricom trade was no different, and that the framework of the Caricom Single Market and Economy (CSME) did not adequately address the conflicts presented by non-tariff barriers.

"The CSME provides a robust policy framework for intra-regional trade development, but this has not been enough to stimulate meaningful transformation of the agribusiness sector," Price said.

"Dense food regulations and underdeveloped food safety machinery continue to retard agribusiness trade within the CSME."

There is in Jamaica fair appreciation of the challenges in cross-border trade, accompanied by much frustration. For example, president of the Jamaican chapter of CABA, Dr Keith Amiel, said that many countries, often to protect certain local crops or foods, implement stiff non-tariff barriers to bypass trade agreements.

"There are a number of SPS measures, some contrived, some imagined, some real; and depending on whether they want to defend the local equivalent to what you are trying to import or not, they will invoke almost anything to stop you," Amiel told the Financial Gleaner.

"A lot of it is arbitrary. They will block you as long as their crop is in and when the crop is over, all of a sudden you'll find that you may be able to get a little in."

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