Sweet trade deals could have bitter consequences

The early weeks of Brexit have been painful for the food industry. A new report claims the risks to public health from free trade agreements should give equal cause for alarm. Nick Hughes reports.

We are almost four months into the UK’s new trading relationship with the EU and, in line with predictions, the impact on food is already proving seismic. Food and drink exports to the EU tanked by more than 75% in January, according to Food and Drink Federation analysis of HMRC data, with meat, fish and dairy especially hard hit.

In a report published in March, the British Meat Processors Association (BMPA) wrote that dismissing trade disruption at the borders as simply short-term ‘teething problems’ is no longer credible. It said British meat companies were reporting “systemic weaknesses in the current export system, mountains of red tape and a potential permanent loss of trade of between 20-50%”. Veterinary inspections and certification along with customs declarations have resulted in a 60-100% increase in costs for each export consignment.

Imports from the EU have been less impacted so far – but were still down nearly 25% in January compared with the same month the previous year. The FDF notes that the continued closure of much of the UK’s hospitality sector will have played some part, but suggests the worst is yet to come with the implementation of full checks at the UK border now delayed until the start of 2022.

To date, challenges around trade have deflected attention from some of the possible longer-term effects of Brexit on the type and price of food sold in this country.

One of the issues that has largely flown under the radar is the risk to government plans to tackle obesity as the UK seeks free trade agreements (FTAs) with the likes of the USA, Australia and New Zealand.

A recent report by the food and farming alliance, Sustain, concluded that the UK government’s aim of halving childhood obesity by 2030 and promoting healthier food environments could be undermined by future trade deals with non-EU countries that allow “a flood of cheap, unhealthy foods into the UK”. As evidence, it cited examples of countries like the USA using trade agreements to stop or delay prospective trading partners from introducing anti-obesity measures like sugar taxes and junk food advertising restrictions.

So should we be concerned? Orla Delargy, head of public affairs and communications lead for Sustain’s Brexit campaign, certainly thinks so: “If the UK’s trade policy allows our markets to be swamped with cheap un-nutritious food it could nudge low-income families towards unhealthy choices. This will exacerbate the health inequalities in this country. We need the government to send an unambiguous message to future trading partners that it will protect its plans to reduce obesity.”

Sustain’s research, conducted by the London School of Economics, found that the removal of tariff and non-tariff barriers to trade – the ultimate aim of any trade deal – can lead to lower prices of unhealthy ultra-processed foods and sugary drinks, which can in turn drive up consumption. For an example, we need look no further than our own prime minister who used a packet of Australian confectionery brand Tim Tams as a prop in a Downing Street video promoting free trade between the two nations. “How long can the British people be deprived of the opportunity to have Arnott’s Tim Tams at a reasonable price?” asked the prime minister of the biscuit treat that contains 44.8g of sugar per 100g thereby comfortably qualifying it for a red light under the UK’s own traffic light labelling scheme.

On the subject of labelling, the researchers found that future moves to introduce mandatory traffic light labelling, along with measures to limit junk food advertising and expand the UK tax on sugary drinks, could be put at risk unless the UK specifically makes protection of public health one of its core negotiating objectives. They note that future trading partners could argue for harmonisation of labelling rules or even the removal of current labelling requirements as a condition of FTAs. During re-negotiations of the North American Free Trade Agreement (NAFTA) in 2018, they point out that the Trump administration sought to limit the ability of the pact’s members to introduce mandatory front-of-pack nutrition labelling. The USA has also successfully lobbied Saudi Arabia to withdraw a requirement that would place mandatory sugar limits on processed food and drinks.

UK government plans to introduce calorie labelling on foodservice menus could also be at risk from a provision known as investor state dispute settlement (ISDS) that allows foreign companies to sue countries for lost profits. Although there has yet to be an ISDS dispute against a food policy specifically, the report suggests “this may reflect the relative recency of government commitments to implement effective food policies that could substantially impact on business profits”. With a number of overseas quick service restaurant chains recently announcing aggressive expansion plans for the UK market, ISDS is one to keep a close eye on.

Given the uncertain state of the UK’s own approach to obesity alongside the risks coming down the track in the form of future trade agreements, you could say that the government target to halve obesity by 2030 currently looks as distant as our antipodean cousins.

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