The National Farmers’ Federation has said that Australian farmers are concerned about the future of farm subsidies in the UK and EU via the Common Agricultural Policy (CAP), in the uncertain post-Brexit trade and economic environment.
“It is suggested that as part of Brexit, UK farmers will no longer receive the generous agricultural subsidies that are associated with EU membership,” the submission said.
“The current EU CAP provides UK farmers with up to 50pc of their annual income, with the average farmer in England receiving direct subsidies of (A$412) per hectare each year.
“Additional payments are available under agri-environmental and other schemes, with the total EU payments to UK farmers exceeding (A$4.9 billion) in 2015.
“It is estimated that payments such as these are roughly equivalent to 50pc of the total income from farming generated in the UK each year.
“In theory, when the UK leaves the EU, CAP payments will no longer be available to UK farmers.
“The suggestion is that the UK government will need to replace these payments with a similar subsidy, and this is an area of significant interest to the NFF, as this ongoing subsidy severely impacts on the competitiveness of Australian products in the market.”
In its submission, JBS Australia said the EU and UK farming sectors were “highly subsidised” which had the effect of placing downward pressure on those markets and acted in combination with tariffs, tariff rate quotas and sanitary and phytosanitary restrictions to provide “solid protection” for farmers in those countries, from international competition.
“JBS supports the Australian government being proactive with the UK in the Brexit period, through undertaking a comprehensive joint scoping study in relation to an FTA between both countries,” it said.
“If there is political will on both sides, then with Brexit there is the opportunity to execute an FTA quickly to deliver better market access for both countries.
“From an Australian perspective, the key is to promote our long term capacity in supplying the UK market and to identify roadblocks in the red meat sector, that we currently have in the EU and to show how breaking these down will result greater commercial opportunities through increased trade.”
Source – http://www.freshplaza.com