This study focuses on the effectiveness of the EU’s import system for oranges. In particular,
does the EU entry price indeed affect the EU import price level for oranges? Further, do the
preferred trading partners actually utilize the trade preferences for oranges?
The EU import regime for oranges has been addressed in several studies before. In their
analysis of the protectiveness of the reference price system, which was the predecessor of the
entry price system until the implementation of the Uruguay Round results, Swinbank and
Ritson (1995: 348) find that countervailing charges were applied 500 times for all fruits and
vegetables in the period August 1988 to August 1994, due to the shortfall of the import price
under the reference price. For oranges, countervailing charges were induced altogether only 7
times which may be interpreted as an indicator for a low protectiveness of the reference price
system for oranges, or alternatively for a successful organization of the exporters concerned
(ibid: 356). These results are in line with an earlier analysis of Williams (1986). Furthermore,
Swinbank and Ritson (1995: 349) expected the substantial increase in the entry price for
oranges compared to the former reference price would be "bound to result in increased
problems in selling sweet oranges into the EU market".
Cioffi and dell’Aquila (2004) analyze the development of major orange exporters to the EU in
the aftermath of the replacement of the reference price system by the entry price system in
1995. Orange exports from Morocco and Israel, the major countries exporting oranges to the
EU in the time period when the entry price system applies and tariffs are high, are compared
to those from South Africa and Brazil, the major suppliers to the EU when the entry price
system does not apply and tariffs are low. The authors attribute the decrease of Israel’s and
Morocco’s exports concurrently with the increase of South Africa’s and Brazil’s exports to
the EU in the period 1995 to 2001 to changes in the EU’s trade preferences as well as
modifications of the EU import regime for oranges (ibid: 175, 178). Furthermore, Cioffi and
dell’Aquila suggest that the replacement of Moroccan and Israeli oranges by Spanish produce
may be due to the relative erosion of Morocco’s and Israel’s trade preferences for oranges
because of the EU-accession of Spain in 1993 (ibid., 175).
In this paper we show that the EU market price for oranges is substantially higher than the
entry price and hence the entry price system for this product has little effect. In addition, it
becomes evident that EU trade preferences for oranges are highly complex. They are
specified, negotiated and repeatedly revised for each preferred trading partners individually.
However, findings suggest that the degree of their utilization is rather low.
The results of this study demonstrate that, in contrast to its complexity, the effectiveness of
the EU import system for oranges is low with respect to its goals, i.e. protecting EU orange
growers on the one hand and creating orange imports from the preference receiving countries
on the other. In the event of the conclusion of the Doha round trade negotiations the
effectiveness of the orange import regime will further diminish.
The paper is organized as follows. Section 2 describes EU orange imports and import policies
for oranges, including trade preferences, in detail. Section 3 explains the methodology and
presents the results of the analysis of the entry price system and the preferential orange
quotas. Section 4 draws summarizing conclusions and puts results in perspective.