Retail consortium boss urges government to negotiate hard on tariff-free food trading
Helen Dickinson, chief executive of the British Retail Consortium

Retail consortium boss urges government to negotiate hard on tariff-free food trading

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The British Retail Consortium is calling for a continuation of tariff-free trading with the EU to avoid “cliff edge” scenarios where fruit and vegetable prices shoot up.

The trade association for the UK retail industry has published a new report – The Tariff Roadmap for the Next Government – setting out its expectations post-Brexit and presenting a survey of its members.

The crux of the report – which has collected data and evidence from UK retailers – is that food imports should be at the nub of negotiations as well as seeking out new trade deals with partners outside the EU.

If this doesn’t happen, warns CEO Helen Dickinson, the UK consumers will pay the price in supermarket aisles. She cites an example of tomato prices potentially increasing by 21% unless existing tariff-free trade deals are maintained.

“While in the short term there are risks, there are also opportunities in the longer term.Ensuring the journey ahead is a positive one means a sequenced and orderly process,” Dickinson says.

“Step one, mitigating the risks by ensuring the continuity of tariff-free trade with the EU, secondly, replicating the existing deals that the EU and therefore the UK currently has with its preferential trade partners. Finally, once these negotiations are finalised, the government should look to realise the opportunities that are out there from new trading relationships with the rest of the world.

“This is what the tariff aspect of a fair Brexit for consumers looks like.”

BRC Roadmap

Based on the BRC’s survey, estimations are that retailers directly import approximately £5 billion of food products and indirectly import approximately £15 billion through wholesalers or manufacturers.

“Beverages, fruit, vegetables, meat and fish are the UK’s biggest imports from the EU and without continuation of tariff-free trade, tariffs could be as high as 46% for cheese or 21% for tomatoes,” it says.

“The weighted average tariff, if the UK were to default to World Trade Organisation (WTO) tariffs on UK food imports from the EU, would be 22%. Such a scenario would put upward pressure on consumer food prices.

“That cliff edge scenario of defaulting to WTO tariffs should be avoided through a transitional arrangement that recognises all goods in free circulation.”

An EU map illustration within the report also pinpoints some potential risks for a multitude of European imported items.

For instance, in addition to citing the 21% potential hike in tomato imports from the Netherlands, it also identifies the UK-France apple deal as potentially having a 15.5% increase if the current tariff-free arrangements are scrapped.

Last month, PBUK also reported how analysts Rabobank claim fruit and vegetable price hikes are likely once Britain has “divorced” the EU no matter why type of trade deals are struck, with some estimates reaching 8%.

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