Joint Statement on a United States-European Union framework on a trade agreement: agriculture footed the bill

The European Commission today presented the joint statement on the framework for trade between the US and the EU. 

The new level of customs duties for European exports to the US has been raised to 15% for products that previously benefited from lower duties (4.8% on average).

For those previously taxed at higher rates, the level will be maintained, except for a few sectors that appear to have attracted most of the European Commission’s attention — and US own interests — , namely unavailable natural resources (including cork), all aircraft and aircraft parts, generic pharmaceuticals and their ingredients, chemical precursors and automobile.

On pharmaceuticals, semiconductors, lumber and automobile and automobile parts, the tariff rate, comprised of the MFN tariff and the tariff imposed pursuant to Section 232 of the Trade Expansion Act of 1962, will not exceed 15%.

Intentions to purchase energy and US AI chips, as well as investments in the US, complete this statement. 

As for the agri-food sector, the situation is seriously worrying and imbalanced. Many doubts remain about future trade relations when it comes to the agri-food sector. For now the Commission failed to defend EU agri-food offensive interests.

At first glance, if this is the starting point for future, more sensible negotiations, EU agriculture is starting many steps behind. 

Possible exceptions for agriculture are not clarified, while vague concessions are made to US imports in some key EU agricultural sectors, not only those previously mentioned (e.g. dairy) but also key sectors such as fruit & vegetables and pig meat.

Particular attention should be paid to the idea of cooperation in the field of sanitary and phytosanitary standards. Even though the European Commission excludes weakening EU SPS standards, what will be the result of the ‘preferential access’ that will be given to some US agrifood products?

With regard to wine and spirits, the statement is silent on these sectors, which seem to have been neglected, if not sacrificed, during the negotiations conducted by the European Commission. The 15% rate will apply to the value of the exported product, making European products more expensive on the US market and jeopardising the efforts made over many years to gain recognition and market share in the US. 

Once again, agriculture seems to be treated as a spare wheel and a bargaining chip, while the interests of some sectors such as the automotive industry seem to have been the main concern of the EU negotiators.