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Brexit and possible impact on Chilean fruit shipments to its second destination in Europe

A webinar on the "Impact and current consequences of Brexit for the Chilean fruit industry" was held On May 4. "We believe it is important to become familiar with the process currently underway in Europe, especially in the United Kingdom, as far as Brexit and its possible impact on fruit imports are concerned. During the 2019-2020 season, Chile exported a total of 553,432 tons of fresh fruit to Europe. The United Kingdom is the second most important destination for our fruits within the European continent, with 107,705 tons imported," said Ronald Bown during the opening of the event.

What is at stake with Brexit?
Natalia Santos-García, director of trade policy at Freshfel Europe, said that the UK is highly dependent on fruit and vegetable imports, as its domestic production covers only 26% of the demand. The supply from the EU accounts for 38%, while that from non-EU countries accounts for 36%. "The international supply has had a positive dynamic over the last few years, with an average increase of 2% in relation to volumes from non-EU countries," she said.

According to the director, the main challenges and opportunities of Brexit for fruit and vegetable traders could be summarized on four levels: tariffs; import procedures and administration; import conditions and logistics, and rules of origin.

Regarding tariffs, she revealed that the UK now has its own WTO tariffs (UK Global Tariff-MFN). "At first glance, they appear to be very similar to the EU's, but you have to pay attention to the details, such as the rounding down. For example, in the case of blueberries, the EU tariff is 3.2%, while the UK rounds them down to 2%, which could affect competition and prices. Secondly, the simplification of their tariffs must also be carefully considered, as they change seasonally."

Regarding the maintenance of preferential tariffs, as in the case of Chile, she said that "with the rounding down, this tariff advantage is more limited."

As for import conditions, she said that for now they are mostly the same as the EU's, "but they will certainly change. Now the United Kingdom will set its own MRL's and rules on active substances, so we'll have to stay watchful."

When it comes to logistical aspects, Natalia Santos-García said that the EU-UK agreement does not include "diagonal cumulation", which means that there will be no triangular supply chain in which a product passes through a country and then continues to the UK, as the tariff will not be maintained.

Lastly, as regards organic products, she said that the UK will have its own certification.



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