In an article in Diplomat Magazine, Dominican ambassador to the United Kingdom, Federico Cuello comments that the Dominican Republic stands to lose big if the United Kingdom referendum set for 23 June 2016 votes in favor of leaving the European Union. UK exports to the DR, which are booming, would also evaporate overnight.
Trade relations between the UK and the DR are governed by the Economic Partnership Agreement (EPA), which allows duty-free reciprocal exports. If UK voters favor Brexit, Dominican exports of bananas, cacao, cigars and rum to the UK could collapse. But the UK stands to lose even more because of the large volume of UK exports of cars, chemicals, electronics, pharmaceuticals and whisky to the DR.
He points out that UK exports to the DR were booming in 2015, a year that saw growth rates of 90%. Cuello highlights that in 2015, the UK became the leading European exporter to the Dominican Republic, well above Spain, Germany, France, Italy, Belgium and the Netherlands.
He makes the point that if UK voters favor Brexit, UK exporters to the DR would feel the impact almost immediately because the EPA would cease to apply the minute the UK signs a Withdrawal Agreement under Article 50 of the EU Lisbon Treaty.
Cuello says that Dominican importers will have to source new suppliers for imports in the United States, with which it has a free trade agreement, DR-CAFTA.
Cuello says that the biggest losers, nevertheless, would be Dominican exporters. “After investing so much time and resources in meeting strict UK quality and fair trade standards, tens of thousands of smallholder farms producing bananas and cacao in cooperatives would be left without access to their largest European market,” he states.
The fresh produce that will be affected also includes air shipments of avocadoes, vegetables and mangoes, which are sold in UK fresh markets. He said the freight business would “evaporate overnight” as the trade barriers return with the vote for Brexit.
