Norway’s notoriously high food prices look set to rise even higher if the country’s powerful farmers get their way. They’re putting more heavy pressure on the government to further boost import tariffs, to keep cheaper competing agricultural products out of the Norwegian market.
The farmers, still angry with Norway’s Labour Party-led government for failing to give them the huge subsidy increase they demanded last spring, now want more protection from the country’s already highly protectionist policies. In an attempt to appease them, the government may give it to them.
Newspaper Dagens Næringsliv (DN) reported on Friday that farmers want the state to have the “flexibility” to impose tariffs either based on a percentage of market value or on Norwegian kroner per kilo, depending on which system would make any given imported food product so expensive that it would effectively be kept out of the market.
Milk, for example, currently has a tariff of 400 percent, to prevent foreign milk from being sold in Norway and thus protecting Norwegian milk. That helps explain why a liter of milk in Norway currently costs around NOK 15 (USD 2.50) compared to half that even in the neighbouring countries of Sweden and Denmark that are considered expensive compared to other European countries.
Nils T Bjørke, head of the farmers’ lobbying group Norsk Bondelag, candidly admitted to DN that import growth “must be hindered.” He claims that without more protectionism, “it will be impossible to maintain sustainable agriculture” in Norway, where farmers expect an income in line with costs.
Bjørke seemingly has little concern or sympathy for Norwegian consumers who already pay among the highest food prices in the world, claiming that it’s more important to ensure the future of domestic agricultural production. His group has also claimed that Norwegians, bolstered by relatively high incomes, use a lower percentage of their household budgets on food than do residents of many other countries, and thus can afford high prices.
Trade dispute blossoming
Meanwhile, though, thousands of Norwegians continue to revolt by flocking over the border to buy cheaper food in Sweden and enjoy a much broader selection of products than what’s found in most Norwegian grocery stores. And Norway’s protectionist policies are already annoying foreign trade partners, with Denmark’s trade minister furious over the recent and sudden imposition of a 72 percent tariff on hydrangea plants, known as hortensia in Norway.
Norwegian growers had been trying to block imports of the popular plants for years, to protect their own interests and raise prices. They finally succeeded this summer, when their professional association Gartnerforbundet won over state and government officials and the new tariff was slapped on imported hydrangeas without warning.
With Danish exporters to Norway furious, their government trade minister is now threatening to slap similar punitive tariffs on Norwegian oil and salmon. Norway’s largest retailer of plants and flowers, Mester Grønn, is also upset, claiming the tariff damages relations with his foreign plant suppliers and can threaten his business that employs more than 1,200 workers in Norway.
Norwegian Trade Minister Trond Giske was left to defend the new tariff, telling DN that the Danes, among others, simply have to accept Norway’s agricultural policies as long as they’re within the framework of, for example, the WTO (World Trade Organization). The government is under more pressure to provide for more protectionism in the next state budget, currently being fine-tuned before its presentation to Parliament in October.
Views and News from Norway/Nina Berglund
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