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Trading on WTO rules is no disaster – it would boost prices for most farmers

Farmers should not fear trading on WTO rules because research shows in most cases their produce would command higher prices, says Peter Chapman, North East Scotland MSP.

Brexit is undoubtedly a divisive issue, but I am sure most folk just want some certainty in what it means for them and for the deal to finally be done.

 

The Prime Minister has said negotiations are moving ahead, but much remains to be done and the prospect of a no-deal outcome is increasingly being discussed.

 

Every businessman knows you can only get the best deal if the other party knows you might walk away.

 

So, although we are working hard for the Chequers deal to be agreed and to secure frictionless trade with no tariffs for food, it is right that the Government plans for every eventuality.

 

It is worth pointing out that, technically, there is no such thing as a ‘no-deal’. What we will have, in that scenario, is a deal under World Trade Organisation (WTO) rules.

 

Myths

 

There are lots of myths and scare stories as to what this might mean for Scottish agriculture.

 

We know our SNP government is desperate for our negotiations to fail so they can lever another independence referendum, but some of the scaremongering is ridiculous.

 

It is important to remember we import 40 per cent of all the food we eat. Many EU countries see our market as one of their premium export destinations.

 

Southern Ireland, for example, sends huge amounts of dairy products here and about 60 per cent of their beef exports come here.

 

Their farmers and farmers across Europe are just as desperate for tariff-free trading as we are. We are net importers of almost every commodity apart from lamb.

 

We export 30-40 per cent of our lamb, which is why it is the one commodity in danger with WTO rules.

 

Rising

 

Scotland’s Rural College (the SRUC) has published a report which shows all commodity prices apart from lamb rising in a WTO scenario.

 

Between 2015 and 2022, the study suggests rises for milk (37 per cent) beef (29 per cent) and cereals (20 per cent). However, sheep prices would fall by 22 per cent.

 

That is undoubtedly bad news for sheep farmers, but not the absolute disaster some would have us believe.

 

If this was the outcome, then extra help for the sheep sector would be needed and that is something I would fight for and I am sure could be achieved.

 

So to recap, I want a deal and I expect a deal will be agreed, but let’s not get carried away with scare stories which are being perpetrated for political reasons that the world would end if we end up trading on WTO rules.

 

Peter can be found tweeting at @PeterChapmanMSP


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