Some fat in the fire
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CTA. 2002. Some fat in the fire. Spore 99. CTA, Wageningen, The Netherlands.
Permanent link to this item: http://hdl.handle.net/10568/47567
Internet URL: http://spore.cta.int/images/stories/pdf/old/spore99.pdf
Since 1 January 2002, the European Union has applied lower import tariffs on some oils and fats from developing countries, primarily for sunflower, groundnut, ricinus and palm oils. Bad news for ACP countries, who already enjoyed preferential...
Since 1 January 2002, the European Union has applied lower import tariffs on some oils and fats from developing countries, primarily for sunflower, groundnut, ricinus and palm oils. Bad news for ACP countries, who already enjoyed preferential tariffs of 0% (100% reduction). Depending on the oil and its country of origin, the new system has two preferential reductions, instead of four before: either 100% reduction, or a deduction of 3.5% from the official tariff percentage. Here s how some competitors benefit. The full tariff for unrefined sunflower or groundnut oil is now 6.4%. Under earlier preferences, groundnut oil from Argentina was taxed at 5.4%. Now, by deducting 3.5% from the full rate, the tax is 2.9%. As a result, Argentina the second largest exporter to the EU can now breathe down the neck of Senegal, the leader. Others such as Brazil and India have similar advantages with other oils, and in 2003, Indonesia, Malaysia and the Philippines will join in. There s another twist in the tale. The full tariff for refined sunflower oil is 9.6% . Under new preferences, Argentina and Ukraine can deduct 3.5%. The EU has decreed, however, that if they sign certain labour rights conventions, they can deduct 8.5%, making a preferential rate of just 1.1%. There is a certain justice in all this, and not just statistical. But from the point of view of an under-capitalised, drought-afflicted, small-scale producer, as our main article in Spore 98 says, survival is a decimal place. Is there life after zero?