In focus: European Union

By Josh Anderson, MLA International Business Manager, Europe and Russia

MLA has hit the ground running in the EU this year. A number of developments in the market over the past year have dominated MLA’s focus given their potential to impact Australia’s red meat market access. These are:

Brexit – wading our way through unchartered territory

Brexit has occupied the attention of the northern hemisphere for months and the next step in this complicated and unprecedented political situation is the trigger of Article 50 of the Lisbon Treaty. When triggered, this essentially kickstarts the two year negotiating timeframe for the UK to leave the EU. No one quite knows what happens next as there are no rules for ‘divorce’ under Article 50.

The Treaty of Lisbon, signed in December 2007, is the European Union's most recent constitution. Article 50 gives any EU member the right to leave the EU and outlines the procedure for leaving. But before the Treaty was signed in 2007 by all EU member states, there was no way to legally leave the EU. Article 50 gives the leaving country (UK) two years to negotiate an exit deal. Once in motion, it cannot be stopped or extended beyond two years without unanimous consent. No other country has embarked on this task before and no one knows exactly how this process will happen.

There are many unanswered questions in terms of how the UK and EU will trade with each other after Brexit. This information is important as it also impacts Australia’s future trade arrangements with both regions.

A-EU FTA – exciting things ahead

Australia and the EU have talked about enhancing their trade relationship for many years and 2017 looks set to be the year this officially begins. Both regions are finishing scoping exercises which are the precursor to FTA negotiations. Once these are published, the European Commission will seek a mandate for approval from all member countries for the formal process to begin.

This is encouraging news for our producers and exporters who have long had limited access to this market. Ever since the UK joined the EU in 1973, Europe has been a low volume, yet very high value market for our beef and sheepmeat exports. This is due to the EU’s highly restrictive tariff rate quota systems and protectionist nature towards agricultural imports.

Many of our global competitors have already begun trade discussions with the EU (recently concluded CETA (Canada); ongoing talks with Mercosur (South American bloc), TTIP (the US) and Japan). We also believe our own FTA negotiations with the EU will be done in parallel with New Zealand, hence it is important to pursue the opportunity directly to keep pace with our competitors.

Other advocacy activities

While Brexit and the pre-FTA process unfolds, MLA is meeting with our contacts in the European Commission and is working with our Australian embassies in London and Brussels and with the World Trade Organization to ensure the Australian red meat industry’s market access priorities are heard.

We are also preparing for our annual ‘Australian themed’ barbecue event of the year in June which has become legendary in Brussels for its impeccable food and hospitality. This is MLA’s signature advocacy event and an important opportunity for MLA to showcase the merits of our industry to a European audience.

We know that the EU and UK have strict import regulations and Australia has some of the best animal welfare, food safety and production systems in the world. So we leverage this in our advocacy in Europe to reinforce our equivalent high standards to the UK and EU.

We are also constantly gathering intelligence through our meetings with UK and European farming lobby groups, trade associations and government officials to find out what the agricultural trade sensitivities are and how Australia can help address these.

More information
Josh Anderson
MLA International Business Manager – Europe and Russia
janderson@mla.com.au