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Expected cost of the new draft Target Operating Model for importers is up to £400m a year
The cost of the UK’s final post-Brexit border checks for food importers are estimated by the government to be hundreds of millions of pounds, adding to upward pressure on inflation.
According to British officials, industry executives should expect that the new draft Target Operating Model, including proposals on how food and fresh produce from the EU is evaluated when it enters the country, will cost importers up to £400m a year. This information was given by two unidentified people at the meetings.
Lingering frictions in the trading relationship with the EU are highlighted by the estimate as final and much-delayed border checks on the bloc’s imports are rolled out by the UK from October. There are also efforts to smooth passport checks for British people visiting the EU and the arrangements at Northern Ireland’s land border taken by Prime Minister Rishi Sunak’s government.
More misery on shoppers who are already suffering the worst cost-of-living crisis in generations and the fastest increase in grocery bills in more than 45 years will be piled by higher costs. The Bank of England, which is trying to reduce inflation, also has additional headaches.
According to Shane Brennan, CEO of the Cold Chain Federation, everything about this is massively inflationary on food costs. Brennan said he was unaware of the cost estimate, in spite of having been at one of the cabinet office meetings.
The £400m cost estimate was first reported by Politico.
The proposals for the UK’s final stage of post-Brexit border checks have been were made by Food industry officials to cut off these “significant” parts of the supply chain for restaurants and grocery stores.
A draft of its Target Operating Model on import controls was released by the UK government earlier in April. Checks affecting animal and plant imports, which will face different levels of scrutiny depending on the risk they’re judged to pose, are included in that.
Brennan said that the actual direct cost will be significant and, assuming there is a significant retraction of the businesses that are willing to supply the UK, then there’s a reduction in supply which will create inflationary pressure.
Executives were told by government officials at meetings that the cabinet office had organized by in recent weeks that the measures will cost £400m more than the current arrangements. Nevertheless, the published TOM documents report that new checks would reduce costs for businesses by £400m relative to its original post-Brexit import model.
According to a cabinet office spokesperson, exploration of the costs of implementing the new model engages industry in the proposals.
He said that a new world-class system to provide protection from security and biosecurity threats, while preventing delays at the border through a reduction in the need for physical checks and by ensuring that checks take place away from ports where this is needed to allow traffic to flow freely will be created by the new border rules.
The spokesperson added that any certificates or physical checks won’t be required for many low-risk goods, which will make their import easier than under the previously proposed model or the EU model.
The introduction of the final set of controls on EU imports was delayed by the government for a fourth time in April 2022. A promise to harness technology to smooth the new checks was given by Jacob Rees-Mogg, the Brexit opportunities minister at the time. Full checks on imports of British goods have already been imposed by the EU.
Many smaller EU importers were warned by industry bosses about too onerous measures, ramping up costs and threatening to damage supply to the supermarket shelves. According to one industry leader, the blow from the changes is likely to surpass the government’s expectations.
Significant proportions of the supply chain will be collapsed by veterinary control requirements on all medium risk goods, according to Brennan.
He said that these regulations concern anything that’s meat or dairy and major disruption is coming for anyone who is in the meat industry or for someone who wants to buy and trade product of animal origin.

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As the Armenian government’s report on the progress and results of the implementation of its plan of actions in 2022 announces, the trade turnover with the U.S. in 2022 more than doubled compared to the previous year to about $465 million.
An increase by 43.8% was shown by Armenia’s trade with EU member states, and the record high of almost 2 billion euros was achieved. Armenia’s exports to the EU showed an increase by 17.8% compared to 2021.
An increase of about 42% was achieved by Armenia’s trade with Iran. It grew up to about $711 million compared to about $503.5 million in 2021.
A growth to $879 million was shown by Armenia’s trade with Georgia (up from $422 million in 2021).
Armenia’s trade turnover with China increased by 39.4% from about $1.8 billion to $1.3 billion compared in the previous year.
The official statistics show that Armenia’s foreign trade in 2022 increased by 68.8% compared to 2021 and reached $14.1bln. The rise of Armenia’s exports was 77.7% while the increase of imports was 63.5%.

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A string of amendments to the law, which designates imported goods, which are not subject to excise duties and are exempted from value added tax, is approved today in the second and final reading by the Armenian parliament by a vote of 81 and 6 abstentions.
The amendments will make import of those raw materials, which are not produced in Armenia, exempted from value added tax (VAT) paid on the border.
According to Deputy Minister of Economy Armen Arzumanyan, currently a large number of enterprises import raw materials, which are not available in Armenia.
He said in parliament that given that the economic policy of the government is aimed at supporting local producers and increasing the efficiency of cash flow management by business entities, they plan to gradually shift taxation on imported raw materials and equipment from the border to the domestic economy.
As Arzumanyan said, gradual exemption of certain types of goods from VAT is called for by the amendments. He added that the country imported about $11 million worth of such goods in 2021, but they expect imports to increase after the approval of the amendments.
According to Minister of Economy Vahan Kerobyan, domestic chicken eggs for incubation; embryos, seminal fluid, seeds; products for the testing industry, including the processing of textile materials, leather, skins, etc.; also products necessary for the production of poultry and meat are included in the list of the goods to be exempted from VAT.

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The Armenian government’s report on the progress and results of the implementation of its plan of actions in 2022 announces that the country increased exports by 54.4% in 2022 and imports by 33.8%.
The amount of about 2.3 trillion (about $5.4 billion) drams was reached by Armenian exports and over 3.7 trillion (about $8.8 billion) drams by imports.
The National Statistical Committee announces the rise of exports by 77.7% from the year before, reaching $5 billion 360 million in January-December 2022.
A 5.7% decrease was shown by exports in December 2022 compared to November, but it was almost a 90.2% rise compared to December 2021. Exports in January-December 2022 reached about 2.3 trillion drams.
During the reporting period, imports increased by 63.5% compared to January-December 2021 and amounted to about $8.8 billion.
An increase by 1.6% compared to November was attained by imports in December 2022 and by 60.2% compared to December 2021. Counted in drams, imports in January-December 2022 surpassed 3.7 trillion drams ($1= 387.94 drams).

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An agreement was achieved between Azerbaijan and Kazakhstan to leverage the full capacity of the Trans-Caspian International Transport Route, also known as the Middle Corridor, which stretches from China to Europe covering Central Asia and South Caucasus.
They came to the agreement during Azerbaijan President Ilham Aliyev’s visit to Kazakhstan on Monday.
As Kazakhstan’s President Kassym-Jomart Tokayev said in a joint press briefing in Astana, it was important to fully utilize the capacity of the Middle Corridor with Azerbaijan, which is the Central Asian country’s Caspian Sea littoral neighbor.
He highlighted the particular importance of the full deployment of the potential of the Trans-Caspian International Transport Route, or so-called Middle Corridor. According to Tokaev, the improvement of logistical services, the creation of unified transport operators, the modernization of technical and tariff conditions, the elimination of administrative barriers and the emergence of a closed logistical cycle was being talked about during the briefing published on President.Az.
He also said that it was important to implement the roadmap for the development of the Middle Corridor for 2022-2027 effectively. Hence, taking full advantage of the growing interest in this route and involvement of third countries in its infrastructure development were agreed about by Baku and Astana.
The simultaneous removal of bottlenecks and the development of the Middle Corridor over the five-year period by all participating states are provided by the roadmap for 2022-2027. Agreed principles of work, as well as specific projects with precise parameters, deadlines implementation and responsible executors are envisaged by the document. The implementation of the agreements will make it possible to increase the throughput capacity along the corridor up to 10 million tons per year by 2025.
An agreement was achieved by Presidents Aliyev and Tokayev in August 2022 to leverage the full potential of the Middle Corridor for contributing to the growth in bilateral trade turnover ($598 million currently after a four-fold increase since 2022).
Cooperation efforts between Azerbaijan, Kazakhstan and Türkiye were decided to be reinforced and regional connectivity through already available and new agreements was agreed to be strengthened by the foreign ministers of the three countries in June in Baku. A decision to capitalize on the potential of the Middle Corridor was also made.
According to President Aliyev, they were already implementing the decisions made in Baku in August of last year, including joint efforts on connecting the transport and logistical infrastructure of the countries in order to fully utilize the opportunities of the Middle Corridor.
As the Azerbaijani president said, referring to meetings in limited and expanded formats with Kazakh officials, specific figures and a schedule for increasing cargo transportation along the East-West route were discussed and tasks to the heads of relevant agencies to study all these issues in the near future were given.
Even bigger benefits to the landlocked countries in the region are promised by the main maritime points of the Middle Corridor (the Baku International Sea Trade Port (Azerbaijan), Aktau/Kuryk ports (Kazakhstan) and Turkmenbashi Port (Turkmenistan)).
It is estimated that in one year, 96 percent out of approximately 10 million containers that are transported from China to Europe, will utilize sea routes and only the remaining 4 percent will use the Trans-Siberian Railway, which is also called the Northern Corridor.
Compared to the Northern Corridor, the Middle Corridor is more economical and faster as a trade route between Europe and Asia, and the travel distance is shrunk by 2,000 kilometers and the travel time is shortened by 15 days compared to the sea route. Climate conditions of the Middle Corridor are also more favorable and great opportunities for cargo traffic in Asia are offered by it, so that the loads can reach the Middle East, North Africa and the Mediterranean region by integrating the port connections in Türkiye.
Due to the Middle Corridor, South Caucasian and Central Asian countries are expected to get economic opportunities, enabling them to benefit from China-Europe trade, which is valued at $600 billion annually. The development and deepening of Trans-Caspian cooperation will be particularly facilitated by the establishment of logistical centers and free trade zones at the ports of Azerbaijan, Kazakhstan and Turkmenistan.

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The work of a regular trade and economic mission of Kazakhstan’s commodity producers has been started in the capital of Azerbaijan. According to Kazinform, the aim of the mission is to boost business contacts between the two countries. The Ministry of Trade and Integration of Kazakhstan and the Kazakh Embassy in Baku organized the event on the threshold of the visit of Azerbaijani President Ilham Aliyev to Astana and the regular 19th session of the Intergovernmental Commission for Trade and Economic Cooperation. Baku welcomed the representatives of more than 20 Kazakh companies arrived to the capital to showcase their goods and services to Azerbaijani partners. They have held talks since Tuesday. Interest in Kazakhstani companies’ products was shown by Azerbaijani companies. The Kazakh delegation was led by Vice Minister of Trade and Integration Kairat Torebayev. He said that Azerbaijan was one of the areas representing high trade and economic interest for Kazakhstan. Contracts worth at least 30 million US dollars are annually entered into by Kazakhstan and Azerbaijan. For example, last year an increase by 40% was shown by commodity turnover between Kazakhstan and Azerbaijan, making it reach 262 million US dollars. A growth almost by 15% was registered in January-February 2023. Today’s event is being attended by 23 companies representing machine building, agriculture, light industry and chemical sectors. Kazakhstan is the place of operation of more than 1,170 companies with Azerbaijani capital today. In its turn, Azerbaijan is the territory where 45 Kazakhstani companies are operating. Mainly floating equipment, railroad locomotives, rails, batteries, petroleum products, wheat, rice etc are exported by Kazakhstan to Azerbaijan. A significant demand for wheat (26% increase), oil products (increased by 3.5 times), margarine (rose up by 4 times) and confectionery (87% growth) was seen this year. Centrifuges and pipes are bought by Kazakhstan from Azerbaijan. The two countries’ businesses were called by the Vice Minister to communicate more actively and enhance bilateral trade ties. He noted that they had over 20 tools of exporters support and they were ready to help each other. As Kairat Torebayev says, Azerbaijani trade house was opened in Kazakhstan. This case was proved to be successful. A similar trade house in Almaty should be open. An opportunity of opening Kazakhstani Trade House in Baku Alongside needs to be considered. According to Ambassador of Kazakhstan to Azerbaijan Serzhan Abdykarimov, Kazakhstan’s economy has been driven mainly by small and medium businesses. They implement new rules complying with international standards. As Abdykarimov says, Azerbaijan is a key trade and economic partner for Kazakhstan in the South Caucasian region. The political dialogue between the two countries is trustful and intensive. The investment and economic ties are strengthened by lifting of pandemic-related restrictions and launch of direct flights. A number of bilateral documents were signed by the business structures of Kazakhstan and Azerbaijan and bilateral talks in B2B format were held after the mission. The event was attended by Chairman of Azerbaijan’s Small and Medium Business Development Agency Rufat Atakishiyev, Deputy Executive Director of the Export and Investments Promotion Agency of Azerbaijan (AZPROMO) Zohrab Gadirov and the representatives of KPMG and local businessmen. Establishing direct contacts, boosting trade relations between Kazakhstani enterprises and promising Azerbaijani importers, traders and distributors were the goals of the mission. As Head of State Kassym-Jomart Tokayev said at the meeting with Azerbaijani President in August 2022, efforts should be taken by both countries’ governments to raise bilateral commodity turnover to 1 billion US dollars in the nearest outlook.

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A business meeting between Rodrigo Chaves and the Minister of Foreign Trade and President of the PROCOMER Board of Directors, Manuel Tovar within the framework of President’s tour in Europe was organized by the Costa Rican Foreign Trade Promoter (PROCOMER) in the Netherlands (Países Bajos in Spanish) with the aim of strengthening trade relations, attracting investment and maintaining the volume of Costa Rican exports to this destination.
Rodrigo Chaves, the director of the PROCOMER Office in the Netherlands, Alexander Román and more than 40 companies including buyers of national goods, investors, airlines, innovation centers, research and development centers, universities, accelerators, logistics service providers, and the ports of Rotterdam and Antwerp-Bruges attended the meeting.
The strategic importance of Costa Rica for the Netherlands on issues such as investment, technology and innovation, due to human talent in various sectors was highlighted by Chaves during his speech. Although the pioneering position of the country in the export of agricultural products such as pineapples, bananas, cassava (yuca) and coffee was mentioned by the President, he noticed the lack medical devices, which are currently Costa Rica’s main export product.
He said that citing of figures about the great commercial relationship that unites the countries could be continued and emphasized on the importance of the people standing beyond the numbers, who will get more and better jobs and opportunities for personal fulfillment and professional, will be able to dream of a better future due to the growth of the countries’ economies and companies. That is why he firmly believes that, in these times of change, when technological progress and climate change impose new challenges and needs, the public and private sectors must join forces to achieve the shared prosperity that they all seek.
Common characteristics of Costa Rica and the Netherlands such as sustainability, openness to trade were underlined during the meeting by Minister Tovar. The both countries are food producers and have a strategic geographical position in their regions, but Costa Rica and the Netherlands are more likely to become allies than competitors.
According to Tovar, 43% of the total exported to this region make the Netherlands Costa Rica’s main trading partner in the European Union. Quality goods in sectors such as precision, medical equipment and agriculture are provided due to varied and differentiated offer of the countries. In its turn, the Netherlands complements Costa Rica with other goods from the chemical, electrical and electronic sector, among others. That’s why strengthening ties and fostering a closer commercial relationship, allowing the countries to increase trade flows and knowledge transfer in both ways are vital.
Strategic issues for Costa Rica such as investment opportunities were addressed by the country’s authorities and the benefits of the supply of goods and services in all sectors, with the aim of strengthening exports to the Dutch market and were widely highlighted at the meeting. Costa Rica was additionally promoted by the delegation of the country as a strategic partner with attributes highly appreciated by consumers around the world, such as sustainability, talent, education, peace, democracy, health and legal certainty.
Goods from the sectors of precision and medical equipment (51%), food industry (22%), fruits, vegetables, legumes and roots (20.8%), plants, flowers and foliage (3%) and chemical industry (1.4%) were exported by Costa Rica to the Netherlands in 2022.
Electrical and electronic products (19%), chemicals (18.7%), food industry (18.4%), precision and medical equipment (10.9%) and plants, flowers, and foliage (10.1%) were imported by the country from the Netherlands.
Costa Rica’s main trading partners in the European Union are The Netherlands, Belgium (28%) and Spain (7%). Additionally, as Trademap reports, Costa Rica was the Netherlands’ 33rd trading partner and its main Central American partner in 2021.

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Plentiful opportunities, especially in the area of oil and gas, tourism, and agriculture, as well as policies developed to stimulate foreign investment and enhance the investment environment, are provided to investors by Azerbaijan, situated at the crossroads of Europe and Asia. Also, investments have been made by Azerbaijan in order to gain access to additional markets and strengthen its presence in the international economy, and capital has been committed by the country to sectors such as energy, real estate, infrastructure, and tourism.
An impressive rate of growth has been seen by Azerbaijan’s economy over the past decade. The World Bank announces a 1.4% increase of the country’s Gross Domestic Product (GDP) in 2020, despite the global pandemic. The fortitude of Azerbaijan’s economy, which has endured multiple economic disturbances in the past, has been demonstrated by this. Azerbaijan’s Gross Domestic Product is estimated to reach approximately $54 billion, with an average annual increase of 1.9% over the past four years. A steady low rate of unemployment has been experienced by Azerbaijan over the past decade (5% on the average). This indicates the strength of the labor market and a prosperity of business environment.
Wise investments in fields that demonstrate promising growth and profitability have been cultivated by Azerbaijan. Due to successful efforts of the nation to broaden its economic base, its reliance on petroleum has been decreased. Notable success has been achieved by Azerbaijan in diversifying its economic base and diminishing its dependence on oil exports. A continuous rise of the non-oil exports of Azerbaijan has been noticed in the recent years; the Azerbaijan Export and Investment Promotion Agency (AZPROMO) reports a 47.2% ($2713.40 million) and 12.3% ($3047.67 million) increase in 2021 and 2022 respectively. An increase of 36.6% in non-oil export earnings (approximately $651.42 million) compared to the same period the year before was recorded between January and February of 2023.
Azerbaijan’s natural resources, mainly its oil and gas reserves, attract multinational corporations from around the world. According to the State Oil Company of the Republic of Azerbaijan (SOCAR), the volume of 33.5 million tons was reached by Azerbaijan’s oil production in 2020. In 2021 it was 29.5 million tons and 32.8 million tons in 2022. Due to this, the nation can be placed among the major oil-producing countries in the region. 35 million barrels are projected to be reached by oil production in 2023. The Oil and Gas Journal announces that Azerbaijan has more than 2 trillion cubic meters of natural gas reserves, which gives a significant opportunity for energy companies worldwide.
A total of $4.5 billion in foreign direct investment (FDI) was attracted by Azerbaijan in 2020: a 5.9% increase in Foreign Direct Investment (FDI) compared to the past year was seen by Azerbaijan, which made it one of the most prominent FDI recipients within the Commonwealth of Independent States (CIS) area. The top three countries by FDI in Azerbaijan in 2020 were the United Kingdom, Turkey and the United States. As the Central Bank of Azerbaijan reports, $1.7 billion were contributed by the United Kingdom, $577 million were invested by Turkey and $475 million by the United States.
According to the Sustainable Development Goals (SDG) Index, Azerbaijan has made substantial strides in reaching the objectives that were put in place by the United Nations across multiple domains. The SDG Index shows a decrease of the rate of global poverty from 49.6% in 2010 to 5.9% by 2022. A positive trend has also been demonstrated by Azerbaijan’s Global Hunger Index (GHI), decreasing from 14.5 in 2010 to 9.7 in 2019 and further to 7.5 in 2022. The benefits of its efforts to bolster health and well-being have been received by the citizens of the country, which was made evident by the increase in life expectancy from 68.6 years in 2010 to 73.3 years in 2022. Azerbaijan’s commitment to improving the standard of living for its people and promoting economic growth in a sustainable manner and its commitment to the achievement of the Sustainable Development Goals are interconnected.
A ranking of 25th place in the World Bank’s Ease of Doing Business report was achieved by Azerbaijan in 2019. A notable enhancement of 32 places from the previous year is demonstrated by this fact and a favorable business climate for foreign investors is highlighted. Azerbaijan was ranked 34th among 190 countries by the World Bank’s Ease of Doing Business Report in 2020, with a score of 76.7 for the ease of setting up a business.
All factors taken into consideration show that Azerbaijan is a highly attractive investment opportunity for a variety of industries, including energy, tourism, agriculture, and technology. A variety of incentives to simplify the foreign investment process has been put in place by the government in order to stimulate foreign investment. Attractive business environment, strategic location, and robust economic growth make Azerbaijan an attractive option for investors to expand their investment portfolios and explore new markets. Azerbaijan’s foreign investments influenced the nation’s economic growth significantly. Leveraged investments can be used by the country to expand its portfolio and reduce its reliance on oil and gas industries, as well as to access novel markets.

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A meeting between Azerbaijan’s Deputy Minister of Digital Development and Transport Rahman Hummatov and Director General at the Investment and Development Agency of Latvia Kaspars Rozkalns has been held.
Prospects for cooperation in the field of transport were discussed by the sides during the meeting. Cargo transportation between the Baltic and Caspian Seas was the main topic of the discussions. The issues of finding suitable routes and transporting goods over these routes were highlighted the meeting.
Views on establishment of cooperation in the field of digitalization of transport, as well as ICT, cyber security, “smart cities” were also exchanged by the pair.

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According to a letter sent to the prime minister of Serbia, Ana Brnabic, Serbia is requested by the European Commission to withdraw the implemented levies on the import of milk and dairy products.
Concern over the various trade restrictions implemented by Serbia in the past months, including the recently implemented levies, importing fees on milk and dairy products, is expressed in a letter sent by the EC to Brnabic.
The levies were not discussed with the EU before implementation, so the EC is calling Serbia to withdraw these restrictive measures.
As the EC confirmed, the obligations from the Stabilization and Association Agreement with the EU were not met by Serbia, because it didn’t consult the EU before implementing those measures and because a satisfactory justification for their implementation wasn’t provided.
Serbia is invited by the letter to withdraw the implemented measures, and unjustified new trade restrictions violating the conditions from the Regulation 1215/2009 and the amended Regulation 2020/2172 are pointed out.
The decision pertaining to the implementation of levies (import fees) of RSD 15 per liter of milk and RSD 30 per kilogram of seven types of cheese – Emmental, Cheddar, Edam, Tilsit, Kashkaval, Maasdam and Gouda was adopted by the Government of Serbia on February 17. The decision was made public by the Ministry of Agriculture of Serbia on February 20.
A positive reaction of agriculturists followed to the implementation of the import fees when it comes to milk, but the implementation of considerably higher levies on Kashkaval and hard cheeses (ten times as high as the current ones) is still being called for by them.
Milk producers’ protests continue. The Sabac Bridge was blocked for two hours on Friday, March 10. The protestors demanded the rise of the milk premiums to RSD 20, the increase of subsidies to RSD 40,000 per head of livestock, the implementation of levies on the import of prepared dairy products and the determination of guaranteed purchase price of milk.

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