COVID19: Cyprus shelves kosher export plans

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Nicosia announced new measures to help struggling animal breeders after plans to export kosher meat to Israel fell through, due to complications arising from EU law and complexities surrounding the procedure.

The Agriculture Ministry scrapped the relative bill brought before parliament to allow Kosher slaughter, while on Wednesday it announced plans to help out COVID-19 impacted stockbreeders with cash subsidies.

A proposal will be drafted by the Agriculture Ministry, to be tabled before the cabinet for approval.

Previously the matter triggered fierce criticism from animal groups as the kosher method of slaughter dictates the animal is conscious during the procedure. By law, animals to be slaughtered in Cyprus must undergo anaesthesia.

The Ministry’s latest proposal provides for a per capita subsidy for farmers, taking into account the loss of income due to reduced demand and low prices, as well as the costs of raising and managing animals, breeders will not be able to sell.

In comments to state radio CyBC, Agriculture Minister Costas Kadis argued that kosher slaughter was a complicated procedure, noting that if Cyprus had acted incorrectly it would be liable to EU fines for export of kosher meat.

Complications arose from a previous misinterpretation of EU directives which had led authorities and local farmers to believe that kosher meat could be exported.

EU directives allow for abattoirs to use the Kosher and Halal methods, but only to produce meat products to satisfy the needs of local religious communities.

“So, instead of going with a hypothetical measure of questionable effectiveness which could bring sanctions on Cyprus, we prefer to go ahead with an immediate and targeted way of supporting sheep and goat breeders,” Kadis told CyBC.

The bill was tabled in a bid to help farmers and especially animal breeders tackle the coronavirus consequences due to low demand and excessive number of sheep and goats at the farms.

It was also seen as an attempt for Cypriot stock breeders to enter the highly protected market of Israel and other EU countries with large Jewish communities.

As Kadis admitted, the bill provided that kosher slaughter would be allowed until the end of this year only.

He said it was to be a temporary and immediate measure to support animal breeders due to the health emergency.

But the government discovered there was no possibility for immediate exports to Israel.

According to Kadis, Israel’s chief rabbi has to inspect the premises that will be carrying out kosher slaughter before any licences are given, but also the Israeli health and veterinary services.

“It emerged that it was not an easy or simple procedure and that it might not bear a fruit because it takes time, so it was not an immediate measure,” Kadis said.

Israel a tough market to crack

Meanwhile, exporting commodities to Israel can prove problematic, as the market is heavily protected with high taxes imposed on incoming products, said a representative of Cyprus Embassy in Tel Aviv.

Although Israel is Cyprus fifth largest trading partner, just 3% of all local exports head for Tel Aviv.

Sofronis Papageorgiou, head of the Cyprus Trade Centre in Tel Aviv told the Financial Mirror that Israel is a hard market to penetrate.

Cyprus exports for the previous year stood at €43 mln. This is excluding cement exports worth some €50 mln, as the only company exporting cement products to Israel asked the Cyprus Statistical services to exclude relative data from reports to protect fair competition.

Another €20 mln worth of fish is exported to Israel from fish farms in Cyprus.

Cyprus dairy producers export limited quantities of cheese, mainly halloumi to Israel.

According to Cystat data, cheese exports to Israel are worth €185,325.

As confirmed by Papageorgiou, exports include quantities of kosher halloumi.

The Cyprus Embassy official said that wine producers have also been exporting small quantities of their goods to Israel.

“Wine exports to Israel, according to available data, are worth around €20,000. There are no exports of kosher wines to Israel. Cyprus wines have a hard time finding their place on the shelves of shops in Israel, as taxes are high and there already is a rich variety of local and imported wines,” said Papageorgiou.

In Cyprus, Lambouri wineries produce kosher wine, which is provided to local stores selling kosher products.

KEO until recently had been exporting kosher beer but backed out of the market at the end of last year as the contract with a local promoter had expired.

A company official told the Financial Mirror they are trying to locate a partner on the ground which will be able to promote the Cypriot beer in the difficult Israeli market.

KEO exports to Israel were worth around €15,000 during 2017-2018.

Enhancing business relations between Cyprus and Israel, despite difficulties, is high on the agenda for the Cyprus Embassy.

“Overall, since the re-activation of the Cyprus Trade Center in Tel Aviv (July 2017), we have observed increasing interest from Cypriot and Israeli businesses, to assess commercial opportunities.”

The centre encourages Cypriot businesses, especially those active in food & beverage to look into exporting goods to Israel, “but they are advised to carefully weigh commercial viability and seek local marketing partners”.

Papageorgiou said that Cypriot businesses wanting to venture into the Israeli market should weigh up a number of elements such as market size and demand for their products as well as barriers they will face entering the market.

“There are a number of import restrictions, quantity quota limitations, procedures for compliance to mandatory standards as issued by the Standards Institute of Israel.”

He said the impact of tariffs on imported goods, would mean that Cypriot products will have a disadvantage in price.

Papageorgiou noted that business relations are expected to be enhanced in the coming years, as ties between the two countries on every level are being strengthened. From political cooperation to promoting joined energy projects.

“Cyprus is seeing the number of visitors from Israel growing at a remarkable pace. In 2014 just 68,822 arrivals from Israel were recorded. This number jumped to 148,739 in 2016, to 293,746 in 2019.

An ever-growing number of Israelis are getting acquainted with Cypriot products and cuisine, opening up opportunities for Cypriot and Israeli businesses to promote commercial relations.”

Visitors from Israel to Cyprus

2014 2015 2016 2017 2018 2019
68,822 98,597 148,739 261,966 232,561 293,746

*According to the Statistical Service of Cyprus (CYSTAT)