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Three associations of table olive manufacturers and exporters from Europe are against a provision in the E.U.-Mercosur free trade agreement that would eliminate import tariffs for Mercosur table olives entering the E.U., arguing that it creates an unfair competitive advantage. The agreement between the E.U. and Mercosur countries, focusing on reducing import duties, has faced political opposition, with E.U. lawmakers voting to delay it.
Three associations of table olive manufacturers and exporters from Europe’s main producing countries have jointly rejected a provision in the E.U.-Mercosur free trade agreement that would eliminate import tariffs for Mercosur table olives entering the European Union.
The newly struck pact between the European Union and Mercosur countries (Brazil, Argentina, Paraguay, and Uruguay) focuses on gradually waiving import duties between the two blocs. The agreement has already faced political headwinds after E.U. lawmakers narrowly voted to delay it.
Under the accord, both sides would gradually reduce or eliminate import duties on 91 to 95 percent of exports over 15 years. For table olives, the deal stipulates that the existing 12.8 percent import levy on table olives from Mercosur into the E.U. would be phased out over seven years.
Exports of table olives from E.U. countries to Mercosur markets, by contrast, currently face a tariff of around 12.6 percent that is not scheduled for removal or reduction under the terms of the agreement.
The tariff scheme for European table olives was retained after Argentina, a significant table olive producer in Latin America, requested that table olives be classified as a “sensitive” agricultural product, thereby keeping European olives subject to import duties in Mercosur countries.
The associations — Asemesa from Spain, Assom from Italy and Pemete from Greece — said the tariff asymmetry poses a direct threat to healthy competition and limits the export potential of European table olives to key markets.
In a written statement, Asemesa denounced “the absolute lack of sensitivity of the European Commission towards the table olive sector,” arguing that the E.U.-Mercosur terms create an “unacceptable competitive imbalance” against European table olives, according to the association’s published response.
In Greece, Pemete head Kostas Zoukas said Mercosur markets could help offset potential losses for Greek table olives in other destinations such as the United States, where new duties have complicated trade for European olive products, including 15 percent tariffs on olive oil exports to the U.S.
“We were counting on the [E.U.-Mercosur] agreement to cover the losses we expect to have in the U.S. market this year, but this is not going to happen,” Zoukas said. “Things will continue to look ugly.”
The three European associations also said the tariff asymmetry is particularly concerning in strategic markets such as Brazil, one of the largest consumers of table olives worldwide.
Brazil, the largest and most populous country in Latin America, is a significant importer and consumer of table olives, importing more than 100,000 tons annually, mainly from Argentina, Peru and Egypt.
While the Brazilian market is dominated by non-European suppliers, a tariff-free trade scheme for table olives from the E.U. could create new opportunities for European exporters. Zoukas said Greek exporters had been aiming to ship up to 20,000 tons to Mercosur countries once the deal came into effect, provided that tariffs were waived.
The associations warned that the current trajectory jeopardizes the viability of the industry, the profitability of Europe’s agricultural holdings and the economic and social cohesion of large rural areas in the E.U.
They called on the European Commission and E.U. member states to reexamine the deal’s table olive provisions to avoid damaging what they described as a strategic sector for the European economy and a key component of regional import/export activity.
The associations also said they are finalizing the creation of a new pan-European association for table olives, aimed at reinforcing dialogue with E.U. institutions and protecting their common interests as olive exporters.