Agri-food exporters may benefit as China lines up big tariff cut
Irish farmers' rapidly growing market in world's second largest economy could get further boost from trade move
Irish agriculture could be in line for a major boost as China cuts tariffs for the majority of its trading partners.
The world's second largest economy - is now Ireland's third largest market for agri-food exports.
The value of exports in the sector has seen a five-fold increase in value terms since 2010.
Beijing is planning to cut the average tariff rates on imports from the majority of its trading partners as soon as next month, two people familiar with the matter have said.
That will lower costs for consumers as China's trade war with the US deepens.
Premier Li Keqiang said last week that China would further reduce the tariffs, without elaborating.
The two people who spoke on the new reduction asked not to be named as the matter is not yet public.
Whether Ireland is included in the tariff cuts is unclear at this point.
But a Department of Agriculture spokesman said that any proposal by China to reduce tariff rates would be of benefit to Irish food exporters "if and when implemented".
China is Ireland's second biggest market for dairy produce and pig meat. Agri-food exports worth almost €1bn went there last year.
In April, Ireland became the first European beef exporter in 18 years to secure access to China's fast-growing market.
By cutting duties on goods even as it retaliates against Donald Trump's trade war with higher charges on some US goods, China is following through on long-stated goals to boost imports.
The move comes as the nation is trying to stimulate consumption to support a slowing economy, and follows similar cuts to tariffs on a wide range of consumer goods.
"By further cutting import taxes, China is sending a message that it will keep opening up and reform no matter how the trade war goes," said Tommy Xie, an economist at Oversea-Chinese Banking Corp in Singapore.
"It's more like a commitment to both domestic and international audience. It's a gesture," Mr Xie added
The Ministry of Finance did not immediately respond to a request for comment on the matter.
China's most-favoured nation (MFN) average tariff currently stands at 9.8pc. The MFN rule requires all countries to be treated equally unless specific exceptions are agreed.
The US is also covered by MFN status.
China still has a higher average tariff rate than many developed economies.
The US's average applied MFN rate was 3.4pc in 2017, and the Trump administration has previously accused China of being a protectionist economy. (Additional reporting Bloomberg)