A new agriculture agreement between the UK and the EU will not eliminate all Brexit paperwork, but it is expected to facilitate sales for specific capital interests, such as Scottish langoustine and oyster exporters. The agreement, described as having a “modest” impact on the UK economy but “significant” for certain sectors, aims to reduce trade barriers for farm produce.
The deal, nearing finalization, would end physical checks on farm produce and remove the requirement for veterinary certificates, which currently cost £200 each. This reduction in overhead costs directly benefits agribusinesses engaged in cross-border trade. William Bain, head of trade policy at the British Chambers of Commerce, noted the agreement could also remove the need to label food as “Not for EU,” a practice he identified as “a significant problem” for wholesalers and distributors.
Capital's Limited Concessions
Before Brexit, Scottish seafood, such as langoustines, could be fished and consumed in Paris within a day. Border checks implemented post-Brexit significantly reduced the shelf life of these products, leading to a halt in many exports and impacting the profitability of the fishing industry. This new agreement seeks to partially reverse these losses for specific capital sectors.
However, the proposed sanitary and phytosanitary (SPS) deal will not erase all bureaucratic hurdles. British exporters will still be required to complete customs, VAT, and safety and security declarations, ensuring that the state apparatus continues to manage and regulate the flow of capital across borders, even with reduced physical inspections.
The State's Management of Trade
The House of Lords heard on Tuesday that the UK and EU are close to finalizing this agreement, demonstrating the state's role in mediating trade relations to protect and facilitate capital accumulation. Labour’s proposed plan to further reduce trade barriers for food exporters involves applying all future EU rules and regulations in relation to farm produce under a system known as “dynamic alignment.” This approach is currently under negotiation, with discussions focused on accepting 76 laws passed in Brussels or from which the UK has already diverged.
Shanker Singham, chair of the Growth Commission and a past adviser to MPs on Brexit arrangements, suggested an alternative path of “mutual recognition” of food standards, similar to the trade relationship between New Zealand and the UK. Singham argued that the UK possessed “significant commercial heft” in negotiations, citing that approximately 23% of the EU’s global agrifood exports go to the UK, with “much less” flowing in the opposite direction. He criticized the UK government for not fully utilizing this leverage.
Persistent Barriers to Accumulation
Singham highlighted that the EU implemented all Brexit rules at its borders from day one, resulting in up to 20,000 British businesses ceasing exports to the bloc. In contrast, the UK did not apply border controls in the same manner, eventually opting for random inspections on fresh food. This asymmetry in enforcement created an immediate disadvantage for British capital.
Sam Lowe, head of trade and market access practice at Flint Global, acknowledged that dynamic alignment would largely eliminate physical inspections, a benefit not offered by a mutual recognition deal. He stated that the UK is essentially asking the EU to recognize its dynamic alignment to secure better treatment for its exporters, noting that EU exporters already benefit from the UK recognizing their rules. This negotiation reveals the ongoing struggle between competing national capitals, with the state acting to secure the most favorable conditions for its domestic economic interests, even if the gains are described as "modest."