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News 19 Aug 13

Serbia and Macedonia Resume Trade Dispute

Serbia is tightening curbs of Macedonian food imports after Macedonia failed to respect a deal to allow the free import of Serbian wheat and flour.

Sinisa Jakov Marusic
BIRN
Skopje
 

Starting this weekend, Serbia boosted inspections of Macedonian agricultural products and other foodstuffs at all border crossings, media reported.

The move is aimed at slowing down and complicating the export of Macedonian products to Serbia, the Serbian daily Politika said, citing unnamed sources in the Serbian Agriculture Ministry.

The countermeasure is a response to Macedonia's failure to amend a regulation curbing the import of wheat and flour from Serbia, the same source said.

Serbia has not confirmed the measures, but the deputy trade minister, Bojana Todorovic, told Politika that consultations continued within the Serbian government on how to respond.

On July 1, Macedonia said that for every kilo of imported wheat, Macedonian importers would have to buy three kilos of local wheat, while for every kilo of imported Serbian flour, they would have to buy four kilos of local flour.

Serbia then accused Macedonia of breaching the Central European Free Trade Agreement, CEFTA, while Macedonia insisted it had a right to limit imports to protect its own producers.

In mid-July, Serbian Trade Minister Rasim Ljajic and his Macedonian counterpart, Ljupco Dimov, agreed that Macedonia would scrap its curbs on imports of Serbian goods.

"We agreed to remove all non-tariff barriers in trade to allow a free flow of goods but also to increase trade and improve economic cooperation between the two countries," Ljajic then said.

The agreement defused the escalating trade row.

But the Macedonian Agriculture Ministry on Monday told Balkan Insight that the restrictions regarding wheat and flour were still in force and would not be removed until the domestic market "stabilized”.

The ministry insisted that Macedonia was entitled to take such action under CEFTA rules.

According to the ministry, in the last 18 months Macedonia has imported some 150,000 tons of wheat and some 70,000 tons of flour, undermining domestic production.

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