Bilateral relations and trade between Morocco and the UK have been increasing since the implementation of Brexit, including in the agricultural sector. The interest from both countries for more cooperation is growing, and one of its recent manifestations is the choice of the UK as the guest of honor at the 15th edition International Agricultural Exhibition in Morocco (SIAM), the main agricultural exhibition in Morocco organized from 2 to 7 May, which is restarting for the first time since the outbreak of the coronavirus pandemic.
The choice of the UK as the guest of honor demonstrates significant potential for cooperation, and also the existence of unresolved issues that need to be discussed at a high level.
Amine Maataoui Belabbes, General manager of Comaprim
According to Amine Maataoui Belabbes, General manager of the Moroccan producer and exporter Comaprim, the most urgent issue for exporters of several products such as tomatoes and cucumbers is the customs tariffs and quotas of fresh produce exported to the UK. Maataoui says, "Representatives of Moroccan fresh produce producers and exporters will meet with the official British government's delegation on the first day of SIAM. One of the most important points on the agenda and the most urgent demand from Moroccan producers and exporters is related to the issue of customs. We believe that the rates and quotas imposed on Moroccan produce are outdated and aberrant, and constitute an oddity that needs to be addressed urgently."
Maataoui, as an expert on the UK agricultural market, explains: "Moroccan tomatoes were exported to the UK, while it was part of the European Union, at 0% duty for until quotas are exhausted and then at a customs rate of 3.5% in the off-season, and 5.7% from May to the end of the season. Furthermore, in the obvious case of cucumbers, which are now exported at 12.8% customs duties, Morocco never paid any duties for years before Brexit. In the course of negotiations between Morocco and the UK following Brexit, an agreement was made to maintain the same customs regulations that were in place with the EU before Brexit. However, maintaining the same rates and quotas ignored the reality of the market and omitted significant volumes."
The agreement, as per its 1st article, aims to "provide a platform for further trade liberalisation between Morocco and the UK", and to "preserve the preferential conditions relating to trade between the 2 parties". Maataoui adds, "We, therefore, realize that the agreement is no longer true to its original spirit and purpose."
Tariffs for the export of Moroccan tomatoes to the UK. Source: Port Partners
Maataoui continues, "Before Brexit, it was understandable that the UK, as a country of the European Union, protected European producers in France or Spain. Today, it is no longer clear why the UK maintains this advantage in favor of European producers, protecting them at the expense of the British consumer. Taxation of Moroccan produce only increases the price on the shelf, especially at times of the year when only Moroccan supply is available on the market and is not in competition with European production, and even less with British production."
"Second, we consider that the agreement between the UK and Morocco following Brexit was made in a hasty and thoughtless manner since it omits very important elements in the calculation of export volumes from Morocco to the UK," continues Maataoui.
"In the tomato and cucumber sector, for example, the agreement was intended to have no impact on export quotas, by exempting the pre-Brexit contingents. However, by taking into account only the volume directly exported from Morocco to the UK, the agreement omits the volumes that were exported from Morocco through other hubs such as France and Spain, which are carried out by certain groups operating in Morocco, and which are quite large volumes. Today, whereas British importers are sourcing directly from Morocco to avoid paying double duties in France or Spain, we reach the limit of said contingents very early in the season, as early as December. This is also an aberration that must be corrected urgently."
Quotas for Moroccan tomatoes exported to the UK. Source: Port Partners
Today, Moroccan exporters are asking for the simple "complete suppression of customs duties on tomatoes and cucumbers", states Maataoui. "We are confident in the good judgment of the British government. We believe that the British government has no intention of useless taxation that only increases the cost of products necessary for consumers. On the flip side, the suppression of taxes is a very valuable leverage tool that the UK government will likely want to seize in order to avoid supply problems that the market has experienced this year. In any case, it will be clear very soon if they are mindful of this problem."
Since the implementation of Brexit, the volumes of Moroccan agricultural exports to the UK have been increasing steadily. According to Maataoui, part of this increase is natural and automatic.
"Moroccan exports to the UK have increased automatically by the share that was exported through France, Spain, or Holland as I explained, and which is exported directly from Morocco after the implementation of Brexit. This part represents quite large volumes, since several groups were operating in that way, and the British customers came to Morocco to get the brands they usually bought."
In addition, direct cooperation between Moroccan and British actors has also resulted in increased Moroccan volumes to the UK, adds Maataoui "If we take tomatoes for example, big British buyers were sourcing part of their supply from Spain and the rest from Morocco. A few years ago, this represented a distribution of around 80-20 in favor of the Spanish tomatoes, but today, buyers are changing their stance and some have increased their share of Moroccan round tomatoes to 90%. This is mainly due to a qualitative and competitive offer and the stability of the Moroccan supply. Yes, the climate conditions and limitations on exports disrupted that stability this year, which created doubts regarding the Moroccan origin, but we hope for a return to normalcy soon."
"Comaprim is one of the main exporters of Moroccan tomatoes and cucumbers to the UK" - Amine Maatouai Belabbes
Several Moroccan producers and exporters have also called for a more structured B2B dialogue and collaboration between agricultural professionals and officials of both countries. Maataoui also expressed his support for "taking dialogue structures to the next step", he explains: "Unlike other destinations in the European Union, the fresh produce distribution channels in the UK are largely based - at 80% of volumes - on retail and supermarkets. This results in more structured and tight relationships and collaboration. 80% of Moroccan agricultural volumes are then exported under contracts, with constant negotiations and discussions, and only 20% is left to the hazards of the market. A Moroccan chamber of commerce exists, but agriculture is not well represented in it, since the market was already quite well structured."
"But now, as Moroccan exports to the UK are increasing significantly, there is a growing need to discuss and resolve new concerns such as the customs issue. A new framework for reflection and exchange, not only in agriculture but in other sectors, can only be beneficial for professionals of both countries," said the exporter.
Comaprim operates an area of 400 ha in the Souss Massa region and exports most of its production to the UK. "We have long been positioned on the British market. One in four Moroccan tomatoes sold in the UK, as well as half of the Moroccan cucumbers, are produced by Comaprim," concludes Maataoui.
For more information:
Amine Maataoui Belabbes
Comaprim
Tel.: +212 528 303 101
Email: amine.maataoui@comaprim.ma
www.comaprim.ma