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Minister Creed's address at Asia Matters Conference, 25 May 2018

Asia Matters Business Summit

25 May 2018 - Cork

“Developing Agri-food market opportunities in China and South East Asia”

Introduction

  • I am very grateful for this opportunity to say a few words to you about the Irish agri-food sector and its growing links with China and South East Asia, and the further opportunities that this region has to offer.  
  • In fact I have recently returned from an extensive and extremely successful trade mission to China and Hong Kong. This was my third such trade mission to the region since I became Minister in 2016.
  • My first trade mission was to China and Singapore in September 2016, while my colleague, Minister of State Andrew Doyle, undertook his own mission to Vietnam and South Korea at the same time.
  • Last November I returned to the region, this time to Japan and South Korea. This was a very opportune time to bring a delegation of Ireland’s food leaders to this part of the world, given that the EU has concluded a Free Trade Agreement with South Korea as well as concluding an Economic Partnership Agreement with Japan.
  • Japan is one of the largest importers of beef in the world. The World Beef and Cattle Analysis puts Japan third in the world for quantity of beef imported, behind the USA and China, and predicts that Japan will import 815 million tonnes of beef in 2018. The Japanese beef market opened to Irish beef in late 2013, and there is now an established trade in beef offal being exported to Japan. Ireland now has the opportunity to expand this trade.
  • Last week in China I met my counterpart, the Minister for Agriculture and Rural Affairs, Mr. Han Changfu.  I also met with Minister Zhang Mao of the newly established State Agency for Market Regulatory Administration and the Vice-Minister for General Administration of Customs, Mr. Zou Zhiwi.
  • These were extremely productive meetings, with excellent results.  Among other things, we will be establishing an official agriculture working group at senior level as part of an agreed comprehensive partnership between Ireland and China.  Through this forum we’ll exchange information in the areas of food safety, sustainability, livestock production and rural development.   A lot of this work already happens through visits by officials and knowledge exchange programmes that have been in operation over the last ten years. However, this is now being enhanced, and should help to expedite the resolution of issues as they arise.
  • I also spoke with Minister Han about the new Chinese rural revitalisation strategy.  While there may be geographical differences between us, Ireland faces similar challenges for rural communities.  I spoke with him about Ireland’s plan for ‘Rural Regeneration’ that takes account of agriculture, the rural economy, rural tourism and small food enterprises. So there is a lot of experience that we can share, and I and my officials look forward to doing so.
  • Of course this visit was also extremely special as it followed quickly on the opening of the Chinese market to Irish beef once again! This recent announcement offers a huge opportunity to the Irish beef sector, particularly when we see that, within the last 30 years, Chinese demand for meat has quadrupled, and the country now consumes one quarter of the world’s meat supply. But demand is still growing, with the average Chinese beef consumption per capita at 4kg per year, compared to the average Irish consumption of 19kg.
  • Consumer demand for premium imported beef is forecast to rise significantly, driven by increasing urbanisation, higher disposable incomes and health awareness.  The import of frozen boneless beef, the category for which Ireland will have market access, has grown nine-fold within the last five years.
  • I cannot stress enough the importance of strengthening trading relationships against the background of Brexit, and creating opportunities for the Irish agri-food sector to grow in international markets.
  • Also, as Asian countries grow and become more prosperous, they seek access to the highest quality food available globally.  Discerning consumers in these markets are also now expressing interest in food that is produced sustainably, so we are always happy to tell them about Ireland’s Origin Green programme and the fact that Ireland is the only country with a national sustainability programme for its food and drink industry, including additional food safety checks and measurable and audited sustainable targets for each farm and food business.
  • Ireland’s commitment to improving environmental protection and sustainability in food production, branded under this label, is crucial to our current and future success. 
  • As the Irish agri-food sector expands sustainably, it seeks the best markets for its high quality produce.
  • While the value of Irish agri-food exports to China and Asia continues to grow - and this is welcome - the partnerships that we have been forging go far beyond a traditional trading arrangement, and are to the benefit of everyone involved. 

Agri-food sector in Ireland

I should also briefly underline the nature of the Irish agri-food sector:

  • It is an important contributor to the Irish economy - accounted for 7.8% of Modified Gross National Income  and 7.9% of employment in 2017;
  • It employs 173,000 people – including those involved in primary production and processing, and in the food and beverages sector;
  • We are very heavily export-oriented - total Irish agri-food exports came to almost €13.6 billion in 2017, which represents just over 11% of total Irish goods exports;
  • Sending products to 180 countries throughout the world!
  • Ireland has a huge competitive advantage, given that it can produce food in a sustainable and natural way. 
  • We combine this natural advantage with a highly innovative and technologically advanced industry that makes us a highly competitive and sustainable producer of some major food products. It has also, for example, made us a global leader in targeted nutrition products, infant formula and food ingredients, – as well as producing more traditional dairy, meat and seafood commodities and beverages.

Export focus

  • Our industry is heavily export-focused.  We are a country of over 5 million people that produces enough food for 50 million.
  • In recent years, with the ending of milk quotas in the EU and the growing innovation and diversification in our industry, agri-food exports have grown rapidly, including through the period of the great recession.
  • Total agri-food exports increased by over 74% from 2009 to 2017, to €13.6 billion. These figures include growth in exports to the UK (+40%) and the rest of the EU (+68%). However, the most significant growth took place to non-EU destinations (+162%), driven by growth in exports to Asia (+280%) and the Americas (+150%).

Key role of food safety and sustainability

  • As we know China and many Asian countries now operate very strict and exacting approval systems before they will approve a product for importation.  They are absolutely right to do so in order to protect their own consumers from product that is unsafe or not authentic.
  • The remarkable success of our food exports in recent years is based heavily on the credibility of our food safety and animal diseases control and regulatory systems, and on our efforts to advance and prove our sustainability credentials.
  • The 180 countries who import our dairy, beef, sheepmeat, pork, horticulture products, whiskey, consumer foods, and so on, would not import one ounce of product if they believed it was unsafe.
  • In Ireland, we are extremely proud of our food safety, animal health and traceability systems, which are regarded as world-class.
  • As I mentioned earlier, we have been approved to export beef to Japan, which has some of the most exacting standards in the world.
  • We are also in the process of negotiating beef access to South Korea.
  • And, of course, our recent achievement of access for our beef to China is also a powerful endorsement of Ireland’s high standards by the Chinese Administration, for which food safety is a prerequisite for trade.
  • Our beef and dairy products are known worldwide for sustainability and high standards of animal welfare.
  • But of course we recognise that we must do much more on the environmental sustainability of our food, bearing in mind our responsibilities in relation to climate change, water quality and biodiversity.
  • We share these challenges with all other food producers globally, but we start from a relatively strong position of having relatively low GHG emissions per unit of output, and very good water quality.
  • We are investing heavily in agri-environment measures at farm level (over €1.5b in our major agri-environmental measures under the RDP 2014-2020).
  • We are contributing to Government planning on climate change mitigation and adaptation under the specific policy for the agriculture and land use sector of an “approach to carbon neutrality that does not compromise sustainable food production.”
  • We are also investing heavily in research around key sustainability themes to ensure that we have the best technology (hard and soft) available to us in this quest.
  • And our industry is stepping up through Origin Green. Led by Bord Bia, Ireland’s food promotion agency.

Planning process – Food Wise 2025

  • The rapid growth of Ireland’s agri-food sector in recent years has drawn international attention and admiration. There are many factors involved, but one element that has been much commented on is our national agri-food planning system, which has been in place for a number of years now.  As you know every five years the whole sector comes together to produce a ten-year strategy.  There have been four to date, and the latest is Food Wise 2025.
  • Food Wise 2025 predicts that over the next decade Ireland can increase the value of agri-food exports by 85% to €19 billion, which should deliver a further 23,000 jobs in the sector.   As you would expect, the growth opportunities in Asia will be a crucial focus for achieving these ambitious projections.

Conclusion

  • Last year we exported just over €1.6 billion of agri-food to Asia as a whole, with €1 billion to China.
  • I believe that there is significant potential for further growth, as Irish food and drink companies tailor their products to match specific and sophisticated consumer requirements in Asia. 
  • Equally, there are real opportunities for Asian Governments and businesses to partner with and learn from our experiences in building a safe, sustainable food industry in Ireland.
  • I am confident that occasions such as this will make a valuable contribution to developing these important linkages.
  • I hope that you will use the opportunity here today to enhance these trading relationships and continue to support me in my drive to expand our exports to Asian markets.
  • I would like to wish Asia Matters and all those involved every success with the Forum, and I look forward to it going from strength to strength in the future.