Ghanaian co-ops face tariffs until post-Brexit trade deal with UK is agreed

If tariffs continue to apply farmers and workers will lose market access, says the Fairtrade Foundation

With the UK and Ghana still due to sign a trade deal, banana and cocoa producers, including some co-operatives, are facing post-Brexit tariffs.

The UK and Ghana are negotiating a new trade deal after the terms of trade the UK enjoyed via the EU ended on 1 January. The UK has sought to reproduce the effects of these trading agreements to ensure continuity but discussions with Ghana are ongoing.

The UK Department for International Trade announced on 31 December that the two sides had reached a “consensus on the main elements of a new trade agreement”. However, since a deal is yet to be signed, producers face import duties under under the UK’s Generalised Scheme of Preferences, which applies tariffs at reduced rates on developing countries.

The Fairtrade Foundation warns that if tariffs continue to apply farmers and workers will lose market access, which will affect the viability of many businesses, including some cocoa co-operatives. The tariffs could also hinder producers’ ability to recover from the pandemic, adds the Foundation.

Tim Aldred, head of policy for the Fairtrade Foundation, said: “The Fairtrade Foundation is pleased to hear that the government has agreed the principles of a trade deal with Ghana. However, we are disappointed and concerned that no deal is in place, despite repeated warnings about this risk and its implications.

“Without a signed deal Ghanaian bananas and processed cocoa products must now pay a substantial tariff increase, the costs of which are likely to be borne by farmers and workers growing these products. Fairtrade bananas now face tariffs equivalent to 9.5p / kg, where previously no tariff applied.

“We urge the UK government to clarify the timetable for finalising its agreement with Ghana, and to put in place provisional mechanisms so that Ghanaian banana and cocoa exports can continue tariff free until an agreement is finalised.”

Ghana’s exports to Britain were worth £498m in 2019.