Editorial Comment Publisher/Editor

 

 

Trade Barriers Aren’t Going Away Anytime Soon

Dick Groves
Publisher/Editor
Cheese Reporter

April 9, 2021


New US Trade Representative Katherine Tai last Wednesday released the 2021 National Trade Estimate Report and, as reported on our front page last week, the report concluded that US dairy and other exporters face numerous barriers in various shapes and forms in countries ranging from Algeria to Vietnam.

What’s kind of depressing about this report, and also kind of predictable, is how little has changed in the general area of trade barriers over the years. Keep in mind that this latest report was released more than a quarter-century after the World Trade Organization was established.

As noted on its website, the WTO “is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. The goal is to ensure that trade flows as smoothly, predictably and freely as possible.”

Well, if the USTR’s annual NTE reports are any indication, global trade actually appears to be flowing less smoothly, predictably and freely than it was, say a decade or so ago.

We arrived at that conclusion by looking, initially, at just one simple fact: the number of pages in the USTR’s NTE reports have been slowly rising over the years. The 2009 report, for example, ran a grand total of 547 pages, while the latest report runs an impressive 574 pages.

It is worth noting that at least a couple of recent reports have dipped below 500 pages (for example, the 2017 report ran 492 pages), but it certainly appears that the long-term trend is for more trade barriers to be erected, and few if any to be dismantled.

Another way to look at how trade barriers don’t seem to be decreasing is to check out how many countries or regions (such as the European Union or Southern African Customs Union) are covered by these USTR reports.
The 2009 report included 63 countries, ranging from Angola to Vietnam, while the 2021 report includes 65 countries, ranging from Algeria to Vietnam.

Yet another interesting way to look at the lack of progress in reducing trade barriers is to compare what was said a decade or more ago with what is being said today. What follows are two quotes, one from the 2009 NTE report and the other from the 2021 report. We’ll run the old quote first, but frankly, it almost seems like these observations are interchangeable, and frustratingly consistent.

Here’s the observation from 2009: “Despite the generally positive character of the US-EU trade and investment relationship, US exporters and investors in some sectors face chronic barriers to entering or expanding their presence in the EU market. A number of these barriers have been highlighted in this report for many years, persisting despite repeated efforts to resolve them through bilateral consultations or, in some cases, the dispute settlement provisions of the WTO.”

And here’s the observation from this year’s report: “US exporters and investors nonetheless face persistent barriers to entering, maintaining, or expanding their presence in certain sectors of the EU market. This report highlights some of the most significant barriers that have endured despite repeated efforts at resolution through bilateral consultations or World Trade organization dispute settlement. Certain barriers have been highlighted in this report for many years.”

One notable change between the 2009 and 2021 NTE reports, at least when it comes to issues with the EU, is how many more dairy-specific barriers there are now compared to back in 2009.

In the 2009 NTE report, the chapter on EU trade barriers runs some 33 pages, including almost 10 pages devoted to agricultural issues ranging from beef to bananas, but dairy issues specifically aren’t mentioned.
About the closest the report comes to mentioning dairy is a paragraph about geographical indications, in the section on intellectual property rights.

How much have things changed as far as EU trade barriers since that 2009 NTE report? For one thing, the chapter on EU trade barriers in the 2021 report runs 50 pages, or almost 20 pages more than the 2009 report.

Also, dairy products are specifically mentioned in at least two sections in the EU chapter, one on how EU certification requirements are limiting US agricultural exports such as dairy products, the other on how the EU’s somatic cell count requirements add unnecessary costs for US dairy exporters without apparent scientific justification.

Maybe the biggest difference between the 2009 report and the 2021 report is the section on EU geographical indications. As noted earlier, the 2009 report devotes a single paragraph to GIs, and that paragraph isn’t all that specific.

The 2021 report, by comparison, devotes about a page and a half to GIs, and specifically mentions that the EU has granted GI protection to Havarti and Danbo, both of which are “widely traded cheeses” covered by international Codex standards. In fact, the US situation vis-a-vis the EU’s GI agenda has worsened considerably over the past decade or so, as was reflected in the new NTE report and will be reflected in future NTE reports for years to come.

If nothing else, these annual NTE reports serve as reminders that the US has faced numerous dairy export barriers for many years, and will continue to do so in the future. The nature of these barriers may change, but the goal remains the same: make life more difficult for US dairy exporters..

 

Dick Groves

Dick Groves has been publisher/editor of Cheese Reporter since 1989. He has over 45 years experience covering the dairy industry. His weekly editorial is read and referenced throughout the world.
For more information, call 608-316-3791 dgroves@cheesereporter.com
https://twitter.com/cheesereporter.


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