Consumers should decide what food they want.
Across Europe, food protectionists are back. Using the excuse of COVID-19, they claim that international trade competition is a problem for domestic producers. In several European legislations, it is proposed to impose quotas of local products on traders, in others it is ministers who make calls for “food patriotism”. It is at such times that it is worth remembering the extent to which this gastro-nationalism is problematic.
The Corn Laws were a perfect example of protectionism in the 19th century: the great conservative landowners in Westminster decided that the UK should tax foreign grain heavily in order to benefit local producers.
The result of this trade policy seems self-evident: while British producers benefited, grain prices soared in the 1830s. As soon as the competition was neutralised, the big landowners were able to raise prices, which mainly harmed the working classes. On 31 January 1849, the disastrous results of the Corn Laws were finally recognised by a law passed in 1846. They were repealed and the import taxes disappeared.
Replacing the word “corn” or “United Kingdom” with any other product or country will not make any difference to the reality of economic principles: protectionism does not work, it impoverishes consumers and in particular the poorest. Unfortunately, this message does not seem to impress our French neighbours. Agriculture Minister Didier Guillaume called on the French “to be patriotic about food” even if “French tomatoes cost more”, according to RTL Radio France. The minister did not mince his words in the rest of his statements on the radio channel:
“Our fellow citizens must buy French. We must develop our agriculture if we want food sovereignty, agricultural sovereignty. But as it is a bit more expensive, we must work to be more competitive. French agriculture must be competitive. The prices paid to producers must be higher than they are today.
Since March, the French government has been in talks with the country’s supermarkets to buy fresh local produce. As a result, France’s largest retail chains, such as Carrefour and E.Leclerc, have shifted almost all their supplies to local farms.
Other countries have gone further than France.
The Polish government has denounced 15 domestic processors for importing milk from other EU countries instead of buying it from Polish farmers.
“The economic patriotism of these companies raises concerns,” the government said in a circular that remained online, even after the list of dairy plants that used foreign milk was removed in the first quarter of 2020.
The opposition comes from Berlin. Ahead of the agriculture ministers’ video conference a few weeks ago, Julia Klöckner, Germany’s agriculture minister, said the Coronavirus crisis underlined the importance of the single market and that EU countries should refrain from implementing protectionist policies to help their economies recover.
“Cross-border supply chains and the free movement of goods are essential to ensure the security of supply for citizens. And that is why I warn against ‘consumer nationalism’. It is only a supposed strength that is quickly fading away. We must not jeopardise the achievements of the internal market,” the statement said.
On the EU side, it is interesting to note that Internal Market Commissioner Thierry Breton seems determined to oppose any protectionist moves (at least outside the protectionist framework already established by the EU itself).
Originally published here.