THE European Union plans to impose tariffs on rice coming from Cambodia and Burma for the next three years in a decision that could deal a huge blow to the agriculturally-dependent Southeast Asian economies.
In a bid to curb a surge in imports, the European Commission, which oversees trade policy in the bloc, proposed the measures last year but failed to get a clear majority of the 28 countries in favour last December.
According to Reuters, the commission itself is bound to make the final decision in the absence of an opinion by the relevant committee.
A source familiar with the process said the committee has set a Wednesday deadline to determine if there is any opposition to the proposal, which sets a duty of EU175 (US$200.73) per tonne of rice in the first year, dropping to 150 euros in the second and 125 euros in year three.
The tariffs follow an initiative by the Italian government to limit rice imports from Asian countries which is aimed at “protecting the Italian and European rice industry.”
Both countries are beneficiaries of the EU’s “Everything But Arms” scheme which allows the world’s least developed countries to export most goods to the EU without duties.
Separately, Cambodia and Burma stand to lose special access to the world’s largest trading bloc over their human rights records.
Earlier, the Commission found that the rice sector in Europe faced economic damage owing to a significant surge in imports.
Eight southern European countries from Portugal and Bulgaria grow rice and the EU farming group Copa-Cogeca has said the two countries’ exports to the EU of longer-grained Indica rice have increased from 9,000 tonnes in 2012 to 360,000 tonnes in 2017, resulting in a collapse of rice prices.
Last week, Cambodian Prime Minister Hun Sen announced measures counteract the effects the removal of preferential trade status with the EU and the United States.
He said the new “National Independence Policy,” aims to make economic growth less reliant on the EU and US markets by facilitating trade through the country’s land border crossings, according to the Khmer times.
“I made a decision on a framework to protect the business climate in our country,” the premier told a dinner of business delegates.
“I told Deputy Prime Minister Aun Pornmoniroth to launch a campaign called ‘Cambodia’s Independence Policy,’” he said, adding that the strategy will focus on improving the trade policy and customs procedures while reducing expenses at the border.
“We have come up with a set of strategies to protect and improve the business sector so that we can survive even if we lose the EBA (Everything-but-arms scheme).”
Seventy-eight percent of Cambodia’s population resides in rural areas, and around 45 percent of the total labour force was directly engaged in the agriculture sector in 2014, according to government statistics.