How big a drop in agricultural exports to the United Kingdom after Brexit? Simulations for sensitive products of four Visegrad countries.

After the European Union (EU) was left by the United Kingdom (UK), a free trade area was established between these economies. Although bilateral trade in all goods is tariff-free, regulatory requirements make exports more costly and burdensome. We used a partial equilibrium model to analyze the implications of Brexit for agricultural exports from Visegrad countries (Czechia, Hungary, Poland and Slovakia). We assess trade creation and trade diversion effects resulting from an increase in non-tariff measures and border costs for 4-digit agricultural products identified as sensitive in each of the Visegrad countries. The simulations reveal that exports of sensitive products from Visegrad countries to the UK could decrease by up to 20%. While the macroeconomic importance of this change is not significant, for the producers of the sensitive goods such export losses are substantial.

Increasing the cost-effectiveness of nutrient reduction targets using different spatial scales.

In this paper, we investigate the potential gains in cost-effectiveness from changing the spatial scale at which nutrient reduction targets are set for the Baltic Sea, with particular focus on nutrient loadings from agriculture. The costs of achieving loading reductions are compared across five levels of spatial scale, namely the entire Baltic Sea; the marine basin level; the country level; the watershed level; and the grid square level. A novel highly-disaggregated model, which represents decreases in agricultural profits, changes in root zone N concentrations and transport to the Baltic Sea is used. The model includes 14 Baltic Sea marine basins, 14 countries, 117 watersheds and 19,023 10-by-10 km grid squares. The main result which emerges is that there is a large variation in the total cost of the program depending on the spatial scale of targeting: for example, for a 40% reduction in loads, the costs of a Baltic Sea-wide target is nearly three times lower than targets set at the smallest level of spatial scale (grid square). These results have important implications for both domestic and international policy design for achieving water quality improvements where non-point pollution is a key stressor of water quality.