Wednesday, 3 July 2019

Questions (46)

Jackie Cahill

Question:

46. Deputy Jackie Cahill asked the Minister for Agriculture, Food and the Marine the position on the latest Mercosur talks; the steps he is taking to protect farmers by ensuring beef will not form part of a final Mercosur deal at EU level; and if he will make a statement on the matter. [28506/19]

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Oral answers (6 contributions) (Question to Agriculture)

The question of Mercosur has become more relevant in the last week. We had been asking the Minister to protect beef farmers under any Mercosur deal, but, unfortunately, beef production is part of the proposed deal. I ask the Minister to set out how he intends to protect the beef industry.

I appreciate that we had an discussion on this matter yesterday and I am sure we will have more engagements on it after Question Time. Such debates reflect the significance of the issue.

On the evening of Friday, 28 June, the European Commission announced that political agreement had been reached on a trade deal between the European Union and Mercosur countries. As a small open economy, Ireland is supportive of international trade deals. However, I am concerned about the impact elements of the deal could have on the beef sector. At a time when the beef sector in Europe is facing significant uncertainty because of Brexit, the agreement includes a significant tariff rate quota for South American beef. Over the full 20-year history of the negotiations, we have worked closely with member state colleagues and engaged directly with the Commission to make concerted efforts to minimise the EU offer on beef. While evidence of these efforts appears to be reflected in the final offer, I am deeply concerned about the potential impact on the beef sector. There may be opportunities for other parts of the agrifood industry such as the dairy sector and the drinks industry, but we will need to examine the text carefully to assess the full impact. It is worth noting that the agreement will not come fully into effect for some years. First, it will go through a process of legal scrubbing, which could take up to two years. Subsequently, it will be put before the EU Trade Council for ratification by qualified majority vote before being put before the European Parliament. If the agreement passes these hurdles, it is expected that the trade elements which fall under the competence of the Commission will be phased in over six years.

I have sympathy for the Minister because he is trying to defend the indefensible. The beef industry is under significant economic pressure. This is the first week of July and beef prices have decreased for the third successive week. The Minister has said there will be a time lag before the deal hits us fully. I suppose it will coincide with the date on which we will have to meet the targets under Food Wise 2025. That shows that it will be impossible to meet those targets. Beef producers are annoyed because the European Commission is speaking out of both sides of its mouth. On the one hand, the need to combat climate change means that European beef producers have to meet conditions that will increase the cost of production. On the other, it is proposed to give free access to beef from South America. Farmers believe they have been let down completely by the Commission. It is all the more galling for beef producers because the Agriculture and Rural Development Commissioner who is leading the Commission team is an Irishman. Farmers who have been despondent about the returns from beef production for many years believe this is the final nail in the coffin.

The Deputy will not find me defending the indefensible. I have stated my view clearly. I have a responsibility to use the time available to us following the announcement of a headline agreement between the European Commission and Mercosur states to ensure everything is done to frustrate and mitigate, dismantle the ambition and protect the interests of the Ibeef sector. As I said, the deal that has been reached at a high political level has not been endorsed by a single member state or national parliament, the European Parliament or the Council of Trade Ministers. There is a significant distance to travel. It is right that attention has been drawn to environmental and climate issues in the context of this proposal. We will, rightly, be implementing significant measures to make progress on climate issues, with which a significant element of the proposed deals. If we can use it to frustrate and thwart the ambition of Mercosur and make sure our efforts are legally robust, it may be possible to use the well documented disregard for climate issues of the Mercosur states to our advantage. That is one area. As I have said previously, we are not without friends in dealing with this issue. We have made common cause with other member states in the beef sector. Collectively, the challenge is to make progress on these matters in a way that will diminish the ambition of Mercosur.

In a previous life I had a lot of experience of negotiations in Brussels. Unfortunately, I have never seen anything promoted in Brussels not happen eventually. It might be in gestation for a long time, but in my experience it will happen eventually. Farmers believe the major industrial powers in Europe want this trade deal for their economies and that European beef farming is the scapegoat. It is proposed to provide for significant imports of pigmeat, poultry, sugar beet and ethanol. Many sectors will be affected. I know that the Minister will do his best to try to thwart the proposed deal, but it will be pushed through by the higher powers that be. We are seeing senior people being appointed in the Commission this week. We are a small pawn in the game of world trade, although we can try to thwart those who are proposing the deal, but in my experience, when the Commission sets off on a certain path, it is very hard to turn it from that course.

The Deputy might be throwing in the towel, but I am not. I appreciate the context his experience at European level lends to his views, but we can try to find common cause. I understand why the Deputy is focusing from a political perspective on the Agriculture and Rural Development Commissioner, but there is also a Trade Commissioner. The Deputy's extensive contacts in Europe may be of benefit to us in that context. We do not have a legally binding agreement. We have a considerable amount of time in which to influence the shape of the deal and secure reinforcements and guarantees in that context. If we find common cause in that endeavour, we may make progress.

Question No. 47 replied to with Written Answers.