Moody plays down fears over a no-deal Brexit
With Brexit representing the most significant change to UK policy and politics since the post-1945 restructuring plans, it is easy for critics to “reach for the apocalyptic”, according to an industry expert.
While admitting that a no-deal scenario, with Europe applying heavy tariffs, would be very bad news for the lamb sector, Jeremy Moody of the Central Association of Agricultural Valuers yesterday told a conference in Carnoustie that, even in the absence of a deal, such tariffs would not necessarily be applied: “While the application of tariffs would spell trouble for some sectors of UK agriculture, if an agreement to avoid tariffs could be struck, then the picture would not be nearly as black as some are painting .”
He said that Europe also stood to lose heavily with tariffs, estimating this to be in the region of €20 billion (£17.6bn) a year: “So you would have to ask why would the trading block be so self-destructive as to impose such tariffs?”
He said that while nontariff barriers such as border controls, additional health certification and other paperwork would add some additional costs, it was likely that these would be offset by currency devaluation: “And while UK government ministers who suggest that currency devaluation will be the cure to all Brexit ills including tariffs are overly optimistic, it could cover most additional costs if tariffs were avoided.”
On farm support, he said that Scotland had considerable scope to draw up a plan which would be better tailored to the country’s needs – but to date there had been little indication of the direction of travel other than a continuation of the current system, with a few tweaks, until 2024.
And he reiterated that, without additional funding, the Scottish Government’s expressed wish to maintain support to hills in the face of £36 million of Eucutsto thelessfavoured areas support scheme would see logic dictate the transfer of monies from BPS payments currently made to region one arable and improved grasslands – especially as Scotland would only have control of Pillar 1 payments in 2020.
On the wider front, Moody also issued a warning to the industry that it had to be willing to accept that no matter the outcome, producers had to be willing to embrace change: “If you want to paint a glum picture of Brexit it is very easy – however, in many ways, Brexit might be viewed as simply pushing the farming industry to do what it should have done ten years ago – and it prompts us to do it.”
He said that looking over the last 40 years of common agricultural policy support, while the early years had incentivised production regardless of market outlets, the Mcsharry reforms of the early 1990’s had incentivised the occupation of land above all else. “And while there might be a temptation to sit back and wait for firm direction from the government, as far as your own businesses are concerned it is important that you manage change, rather than sitting back and letting change manage you.”