The agricultural trading policy of the European Union has been criticised because higher import tariffs apply to processed products than to unprocessed agricultural products.
This 'tariff escalation' is a particular disadvantage for developing countries. For these countries, it is important to be able to sell processed products on the international market, as a greater profit can be achieved that way.
In order to gain insight into tariff escalation, LEI Wageningen UR has carried out an analysis of the structure of the import tariffs of the European Union for ten agricultural products important to developing countries. Tariff escalation applies to imports of cocoa, tomatoes, palm oil, soya, leather and cotton. It does not apply, however, to imports of sugar, poultry meat, beef, wood and hides. The analysis shows no clear relationship between the imported volume and the level of the import tariffs. It is often the case that the highest import tariffs are applied to products within a group of products that is imported the most.
The EBA agreement has been in force since 2002, as a result of which developing countries are given preferential treatment when exporting to the European Union, and lower import tariffs are applied, if any at all. It appears that agricultural exports from EBA countries to the EU have grown more strongly than those from other countries, which indicates that high tariffs have in the past genuinely formed an obstacle for these countries in accessing the EU market.