Did you know that because food and drink manufacturing is an international business with ingredients often coming from many different counties, a ‘hard’ Brexit might mean that many companies’ supply chains might not comply with the EU’s future ‘origin’ requirements – with dire financial consequences.
Even if the UK Government manages to negotiate a generous free trade agreement with the EU, exporters would still need to comply with complex ‘origin’ requirements. These dictate whether or not a product is deemed sufficiently ‘British’ and therefore qualifies for a preferential tariff that has been agreed in a trade deal.
UK manufactures do, in the main, ‘buy British’ but UK farmers cannot supply all the ingredients that they need. Nor can they supply even the ingredients that they do grow all year round. As a result, many food and drink products are a mixture of domestically and internationally supplied goods.
Under existing EU models, once outside the EU, many UK manufactured products would not qualify for preferential tariffs. For example, UK chocolate producers who export £530million’s worth of products each year to the EU could face tariffs of 27% or more depending on how much of UK’s refined cane sugar came from the world’s poorest countries and how much Irish milk was in their products.
So manufacturers could face the prospect of either having to ‘restructure’ their supply chains (a seriously costly business) – or being barred from future EU-UK trade as a result of the EU’s Most Favoured Nation tariffs which are prohibitively high for food and drink, rising to more than 100% on many of products.
Neither is an appealing prospect for the UK food industry. Current export trade with the EU, by the way, is worth more than £13.3 billion each year.
Thanks to a Food and Drink Federation for press release for this information.
What can we do to stop this madness. After an initial fightback from ‘remainers’ our voices appear to be lost.
The real Brexit tragedy is how little the benefits of the EU single market are understood, particularly by the UK politicians currently squabbling over it. The UK government seems to be convinced that – at the end of the day – the EU will give the UK a sweetheart deal that will mirror single market membership.
This will not happen because it cannot. The European Single Market (ESM) works because it provides a single set of rules managed by a single pan national body – the EU Commission – and governed by a single legal entity, the European Court of Justice (ECJ). These are all essential components of the ESM.
The purpose of Brexit is to free the UK from the influence of these supranational bodies. Once free, Dr Fox will be able to implement a trade deal with the US. The US is keen to sell the UK its agricultural products. US FDA rules are profoundly different from those of the EU. A trade deal with the US will require the UK to accept US standards. Once that happens we can say goodbye to £13.3 billion of agricultural exports to the EU. The EU will not – cannot – enter into any agreement with the UK that will damage the Single Market.
End of story…
I agree. We should also remember that ‘Dr’ Fox, who insists on using this title (despite not possessing a doctorate or even practising as a GP for over 25 years) is a disgraced former cabinet-member who was forced to resign for mistakes of judgement. In 2009 he was required to pay back a large over-claim for parliamentary expenses. It’s only politicians who are able to erase their history of wrong doing and pop back into public life as though nothing ever happened.