News trade agreement
EU and Mexico sign trade deal
The negotiations lasted 4 years, but at the end of April the time had come. The EU and Mexico have reached an agreement on a trade deal. With this agreement, the 20-year-old existing agreement will receive an 'update'. What does this deal mean for the European and Dutch agricultural sector?
Mexico is the largest trading partner in Latin America for the European Union (EU). With this 'update' almost all import duties on products traded between the EU and Mexico will expire. The 2018 trade figures show that the EU exports €10 billion in services and €38 billion in products to Mexico. €1,4 billion of exported products is related to food and beverages.
European agricultural sector
When the EU agreed on the CETA trade agreement with Canada, there was a lot of commotion, also in the Netherlands. This was largely because the EU also agreed to the International Court System with the agreement, but also because of uncertainties surrounding food safety. How is it possible that the trade agreement with Mexico can pass so 'quietly'?
In the Netherlands, but also throughout the EU, food safety is sacred. High demands have been placed on food safety and we also want the countries from which we import to observe the same requirements. Now it is the case that this deal mainly affects exports to Mexico for Europe. The EU imports less from Mexico than it exports to it.
Europe hardly imports any products from Mexico, it is mainly the other way around. Mexico imports, among other things, chicken, pork, cheese, drinks and fruit. With the new trade agreement, these products can be imported largely free of import duties from Mexico. There is a limit for cheese, except for blue cheeses. For example, 5.000 tons of fresh and processed cheeses can cross the Mexican border without levies and 20.000 tons of other cheeses.
Safety for European consumers
Because Europe would like to guarantee its high food safety, requirements have been included in the deal. For example, Mexican products must meet the European food safety standard and the health of living plants and animals must also meet European requirements. In addition, Europe has the right to tighten (or relax) the rules in the future without jeopardizing the trade agreement.
Influence on the Netherlands
Statistics Netherlands figures show that the Dutch agricultural sector has little to do with trade to and from Mexico. For example, the Netherlands does not import meat from Mexico, nor does dairy products. We do export dairy to the Latin American country ourselves. In 2018, the export value of these dairy products amounted to €40 million. We also exported €1 million in fish, crustaceans and molluscs and €13 million in live animals. Our total Mexican export value was €2.576 million. Our agricultural sector therefore only contributes a small part.
In total, we imported €1.841 million worth of Mexican products. This also contains a small part of agricultural products. Although we do not import dairy and meat, we did receive €2018 million worth of Mexican vegetables in 153.
Jorine Cosse
© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.
