World trade deal may cost €1.2bn and 50,000 jobs

IRELAND’S thriving agri-food sector faces up to 50,000 job losses and the economy could lose €1.2 billion over the next decade as a result of yesterday’s World Trade deal, according to farmers’ leaders.

Farm organisations say the deal, which has hit the sector a double blow, will destroy the farming sector.

Ireland succeeded in ensuring there will be no change to direct payments under the EU’s Common Agriculture Policy until 2013 at the weekend.

However, the real threat comes from the EU agreeing that export refunds will be abolished progressively from 2013, making it almost impossible for food exports to compete on price.

On the other hand, Europe is liable to be flooded with imports of cheap food, especially beef, from countries like Brazil where costs are much lower.

IFA president John Dillon described the WTO deal as a black day for farm families. “They have paid a heavy price. One of the lowest income sectors has been forced to bear the cost of the deal,” he said.

Ireland must export nine of every 10 cattle produced making it the highest beef exporter in the EU and one of the biggest in the world. More of the country’s beef and dairy produce is being exported to other EU countries and especially to Britain in recent years.

“If Britain for instance decided to take more meat from Brazil, Ireland will have to find another market,” said the IFA’s Michael Tracey who was at the talks in Hong Kong.

Ireland has been warning that the policy adopted by the EU Trade Commissioner Peter Mandelson would lead to the Irish agri-food industry being sacrificed.

IFA economists say the deal will destroy a third of farm output, which would mean a loss of €1.2bn to the country. Farm incomes will fall by 35%, with a knock-on loss of €800m to the rural economy.

Mr Dillon said 50,000 jobs would be lost in farming, farm supplies and processing as more and more of the European food market was taken over by North and South America, Australia and New Zealand.

ICSA president Malcolm Thompson said, while the news on export refunds was bad, worse could come on market access and import tariffs. “This deal means our ability to supply non-EU international markets has effectively been wiped out. Even before 2013, when export refunds are whittled away, the days of supplying beef to Egypt and Russia are effectively over.

“A threat of drastic cuts in import tariffs is still hanging over us and we are facing the prospect of being heavily undercut in our European market, by Brazilian beef, for example,” he said.

MEP Mairéad McGuinness said Agriculture Minister Mary Coughlan must show leadership and plan for an era without export refunds. She also questioned whether poorer countries will benefit from the WTO deal.