'Economic stability comes from global trade with minimal trade barriers and political interference'
Trade wars produce no winners.
They end in negotiated agreements when common sense prevails, but leave behind a lot of losers and collateral economic damage. The food and drink industry in the EU, which then included the UK, paid a heavy price for the battle over aircraft subsides between Europe and the United States.
Now a similar battle is imminent with China, which is always in the top five export markets for European food.
Unless a deal is reached, come the end of this month the EU will impose tariffs on imported Chinese electric vehicles. It says this is to protect European manufacturers from Chinese state subsidies and lower production costs. China has confirmed it will retaliate with action against targeted high value products. The dispute will stagger its way to the World Trade Organisation and while that process unfolds businesses across Europe will pay the price. Because of Brexit the UK is not part of the fight.
It looks unlikely it will follow the EU lead, meaning cheap Chinese cars, led by MG, will still be available here without punitive duties. Depending on the EU products targeted by China this could create export opportunities for the UK, but in a global trade context that would be a pyrrhic victory. Economic stability comes from global trade with minimal trade barriers and political interference.
Given the state of geopolitics a trade war with China is the last thing agriculture needs. Russia and Ukraine are a long running issue, the Middle East is a tinder box and we are weeks away from a potentially divisive and damaging election in the United States.
There are few, if any, political voices or institutions with the power to pour oil on troubled waters. This adds a new dimension to food security. Indeed some commentators now say geopolitics are the biggest threat to food security and our dependence on long supply chains rather than stable production closer to home.
We can take some comfort from a stable EU remaining our biggest source of imported food, but for many products long and increasingly risky supply chains are a fact of life. This is something politicians should be taking on board, but there is no evidence of that happening. The government, with a massive majority, is in a strong position to be radical, but instead it is being torn apart over free suits and tickets, poor selection of key advisers and internal dissent over policy that will get worse after the budget. Ironically this is happening as Boris Johnson touts to the media his book defending his record in a government, which fell to the same problems as Starmer is facing after an election victory.
Plus ca change, plus c'est la meme chose indeed when it comes to politics.
Agriculture needs radical thinking and there is some chance of that happening in the EU. There is a commitment from the top in Brussels to make the CAP more farmer friendly and to find new ways to encourage young people into agriculture. In member states and at an EU levels the EU is being wobbled by concerns around a sector that drives the agricultural economy, but rarely makes the political headlines of livestock production.
To say the arable sector, from farmer to processor, is unhappy would be a big understatement. There are concerns around prices, the impact of an open door policy towards Ukraine and the impact of green demands on the industry. There is pressure for unaffordable additional support. For Brussels this is a new front in its efforts to calm the farmer anger that the protests earlier in the year brought. The arable sector is a bit of a gentle giant in Europe, but if the cold it has now becomes a flu the entire European agriculture is at risk of an economic pandemic.
In London the Defra minister, Steve Reed, has announced a review of this department's agricultural regulations, with the aim of making the delivery of economic growth the main driver of policy. That will be welcome if it accepts the logic that economic growth in farming does not come from the imposition of green policies.
If that thinking can be changed to create a new 'green revolution' around quality food, local sourcing and food security it would break the lacklustre performance of a string of agriculture ministers right back to the Peter Walker/John Gummer era.
A dream outcome, but not one to hold your breath waiting for.
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