With Brexit, British agriculture faces new challenges
Members of the World Trade Organization (WTO) like Indonesia, Argentina, the United States, China, and Russia are taking a keen interest in Brexit, particularly on how Britain will handle its agricultural tariff system in the future. Indonesia officially posed the question on Britain’s agricultural market status in WTO’s agriculture committee.
Liberating Britain from the chains of the EU’s Common Agricultural Policy (CAP) is an iconic demand for Britain’s eurosceptics. CAP consumes 40 percent of the European Commission’s budget. In 1984, Prime Minister Margaret Thatcher argued that Britain has a much smaller agricultural sector to demand and secure the famous rebate on the UK’s contribution to the EU budget. And even the proEuropean Liberal Nick Clegg has called the CAP a “wasteful and economically perverse support system for Europe’s farmers.”
As Britain sets out to embrace the opportunities of a post-Brexit world, there are few challenges London will need to address, including rallying the consent of 164 WTO members on the level of subsidies for its farmers, for commodities such as beef, poultry, or wheat, as well as preferential trade schemes for poorer countries. While negotiating with the world, Britain must also negotiate with its own farmers a new agricultural regime, which will be less protectionist and presumably more open to global competition.
EU agricultural subsidies make up for 67 percent of farm income in the UK according to a study commissioned by the British National Farming Union. Of course, these are not all family-run businesses.