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Irish fear big losses on Mercosur beef deal

Sunday Business Post, Ireland

Irish fear big losses on Mercosur beef deal

24 July 2011

By John Burke, Public Affairs Correspondent

The EU’s trade chief, Karel De Gucht, has said the European Commission remains supportive of a trade agreement with South America’s Mercosur beef trading states despite Irish opposition to a deal.

Agriculture minister Simon Coveney has signalled Ireland’s concern that the Irish beef sector could be ‘‘sacrificed’’ to allow more South American beef into the EU, in return for allowing European financial service providers and German and French car-makers to gain access to the Mercosur countries of Argentina, Brazil, Paraguay and Uruguay.

In response to questioning about Ireland’s opposition to a deal in which the beef production sector here could suffer significant losses, De Gucht told the EU Parliament that the EU Commission believed a deal with Mercosur states could generate ‘‘considerable economic and political benefits for both the EU and the Mercosur region’’.

Coveney has said the current bilateral talks between the EU and Mercosur states represented what he described as an ‘‘extraordinary threat to the Irish beef industry’’.

A widely-leaked preliminary report into the effects of a deal with the Mercosur states indicated that Europe’s farming sector could lose an estimated €3 billion and shed more than 30,000 jobs between now and 2020 if an agreement is reached, although it estimated the wider trade benefits could outstrip the agriculture-related losses.

Ireland, France and Spain could stand to lose a disproportionately higher share of revenue and jobs compared to other EU member states because beef production forms a larger share of the agriculture sector in these states.

In a written letter to the commission, Scottish Liberal Democrat MEP George Lyon asked De Gucht to outline his present thinking in relation to the chances of concluding an agreement, given the ‘‘clear reservations which have repeatedly been expressed and the fairly negative signals now being sent out by a substantial number of member state ministers, starting with those from France, Ireland and Spain’’.

De Gucht said that, as a large and dynamic economy, with a GDP growth rate of around 8 per cent in 2010, the Mercosur region was still a ‘‘relatively protected market’’.

‘‘The economic benefits of opening up for EU exporters, investors and services providers, could be very significant," he said.

‘‘Both sides have a number of clearly identified offensive interests including agricultural products, which will need to be taken into account in any final agreement. EU interests in agriculture are not only defensive but include important offensive interests - identified in consul tat ion with the relevant stakeholders and by analysing relevant statistical and economic data - such as malt, olive oil, wine and spirits, some dairy products, processed food and protection of geographical indications."