Preferential tariffs and development of Norwegian rose import from Africa
Journal of Agribusiness in Developing and Emerging Economies
ISSN: 2044-0839
Article publication date: 11 May 2020
Issue publication date: 17 July 2020
Abstract
Purpose
Imports of cut roses increased after Norway implemented a preferential tariff scheme for the least developed countries in 2002. When the scheme was extended to more countries in 2008 – among them Kenya – imports exploded. This article studies the subsequent changes in supply channels, import costs and the way Norwegian firms imported.
Design/methodology/approach
Qualitative data, obtained through interviews among five rose importers, are combined with quantitative data for all importing firms and transactions in Norway for the years 2003–2014. These data are analysed in light of recent economic theories on international trade.
Findings
When Kenya was included in the scheme, imports from Europe and domestic production in Norway decreased substantially. Imports from some African countries with low income levels also declined. Importing under GSP involves high fixed import costs due to stringent procedures. Each firm's imports increased gradually, and over time learning may have facilitated importing. Direct trade with African producers and control over the logistics chain seem to have become more important.
Research limitations/implications
The analysis builds mainly on data for Norwegian importers, not for African exporters.
Practical implications
Simplifying the GSP procedures could increase Norwegian imports from developing countries and induce establishment of new trade relationships, perhaps also for other products than roses.
Originality/value
Using a mixture of original qualitative data as well as unique, detailed and comprehensive quantitative data, the article provides new insights into how preferential tariff reductions for developing countries’ exports to a developed country affect trade and buyer–supplier relationships.
Keywords
Acknowledgements
The authors thank Åshild Auglænd Johnsen and Arne Melchior for comments and suggestions during the whole research process. Johnson also helped with the analyses of the quantitative data. Furthermore, the authors thank Karl Rich and representatives from the Directorate of Customs and Excise, in particular Reidar Knutsen. Finally, the authors thank Susan Høivik for copyediting. Research was funded by the Research Council of Norway, project 233836 “Traders in the Food Value Chain: Firm Size and International Food Distribution”. The funder had no role in study design; in the collection, analysis and interpretation of data; in the writing of the report; or in the decision to submit the article for publication
Citation
Medin, H. and Bachke, M.E. (2020), "Preferential tariffs and development of Norwegian rose import from Africa", Journal of Agribusiness in Developing and Emerging Economies, Vol. 10 No. 3, pp. 341-361. https://doi.org/10.1108/JADEE-08-2019-0110
Publisher
:Emerald Publishing Limited
Copyright © 2019, Emerald Publishing Limited