Food processors in EU accession bloc to benefit in long term
current and new member states of the European Union is the focus of
a new report that predicts the new member states are well
positioned in the long term because of the low cost of labour and
land, writes Anthony Fletcher.
Expansion on 1 May by ten countries will see a substantial rise in population, area and employment in the EU. In economic terms, growth in the EU will be relatively limited, with a rise in the average prosperity in the new EU countries, currently around half the level of that in the present fifteen EU members.
In the short term, the current member states are likely to profit most from the expansion. The lifting of residual administrative barriers will stimulate trade and this will be accompanied by a reduction in the risks and uncertainties of business transactions, which will in turn prompt investment.
In the longer term however, the Rabobank report, which concentrates on dairy, grains meat, sugar and vegetables, predicts that the new member states will be well positioned because of the low cost of labour and land. However, they will not for a while be able to optimise the benefits of their accession until the many challenges they face have been met.
Improvements are necessary in terms of structure, productivity and knowledge, and there has to be further modernisation. It is also essential for the new countries to comply across the board with EU requirements on food safety and animal welfare.
This is something that the Confederation of the Food and Drink Industries of the EU (CIAA) president Jean Martin highlighted when he met with representatives of the Irish health, trade, employment and agriculture ministries recently. He said that food companies from the new Member States had to meet the standards of the rest of the EU, and called on the Irish Presidency to make sure it had the right administrative and control structures in place to ensure that those food companies which do not conform at the time of accession will meet their commitments.
The CIAA said it would continue to help food and drink producers in the candidate countries to meet the requirements of EU legislation to ensure that there is no weakening of standards after expansion - but stressed that the Presidency had to play its part as well.
The report, entitled 'The new EU; outlook for farmers, processors and traders' was launched at the annual Dutch agricultural journalists meeting at the Rabobank Group's headquarter in Utrecht.
