Australia-EU deal can work, says CAOBISCO

July 12, 2023

Although the Australian government reportedly expressed disappointment about the EU’s offer on market access for agricultural products, CAOBISCO (the Association of Chocolate, Biscuit and Confectionery Industries of Europe) has announced a solution from which both sides – Australia and the European Union – could benefit.

“Australia is one of the most significant destinations for European confectionery. In addition to seeking greater market access, our sector also aims for simplified export procedures,” said. Karsten Daum, Chair of the Economic Affairs Committee of CAOBISCO.“We therefore urge the EU to take complexity out of the conditions for freer trade. This will also serve in particular small and medium sized companies.”

CAOBISCO said it has been calling for value-based rules of origin under the EU-Australia Free Trade Agreement (FTA).

“Value based rules of origin take into account the fact that the EU is a net-importer of sugar, and that this domestic deficit will most probably last in future due to climate change impact on beet,” added Daum.

Other Free Trade Agreements like EU-Canada or EU-South Korea have acted as demonstrable examples of how value-based rules of origin do not harm the European sugar sector. A better approach on the rules of origin, said CAOBISCO, was taken in the UK-Australia Trade Agreement, where a ‘change of tariff heading’ recognises the substantial transformation of inputs into processed goods.

CAOBISCO also sees a mutual benefit for Australia’s interests in better market access for its agriculture sector.

“It is in the best interest of European manufacturers of confectionery, chocolate, and fine bakery products that the EU diversifies its supply options for sugar,” explained Muriel Korter, Director General of CAOBISCO. “Therefore, we need a large tariff-free volume of sugar from Australia. We have witnessed the overly restrictive import system for sugar in the current marketing year, and new import options are urgently required.”

In the trade agreement with the UK, Australia secured a market access for 80,000 tonnes of raw cane sugar. In the association’s opinion, the agreement with the EU must include significantly higher import volume. And in order to face immediate shortages, the FTA must provide for a significant amount of white sugar imports which can be used directly and more rapidly by food and drink manufacturers.

CAOBISCO does not see any risks putting the EU’s defensive interests at stake, it said. However, the EU should not overlook its offensive interests. With over 12% of its production intended for the global market, the confectionery sector is a vital component of EU exports. CAOBISCO is ruging the EU to prioritise the export competitiveness of European confectionery manufacturers and emphasising the
crucial importance of securing better access to sugar. Australia provides a significant opportunity to achieve both of these objectives.

Stay up-to-date on the latest industry news and exclusives in our magazine.