No-deal Brexit is an event you can’t fully pre­pare for

Irish Examiner - Farming - - COMMENT - Stephen Cado­gan

What Ir­ish agri-food prod­uct might be hit hard­est by a no-deal Brexit?

It’s prob­a­bly a toss-up be­tween a few of them, but cider has emerged as a likely front-runner.

Up to 85% of Ir­ish cider goes to the United King­dom for sale. Most of the cider ap­ples are grown north of the Bor­der. If a no-deal Brexit in­cludes a tar­iff on ap­ples com­ing in, and a tar­iff on fi­nal prod­uct go­ing out, there could be se­ri­ous dif­fi­cul­ties for this favourite Ir­ish bev­er­age.

The threat to cider was high­lighted by the Al­co­hol Bev­er­age Fed­er­a­tion of Ire­land’s Pa­tri­cia Callan at a re­cent Joint Oireach­tas Com­mit­tee on Agri­cul­ture, Food and the Ma­rine, where the im­pact of Brexit on the agri­food sec­tor was de­bated.

The threat has deep­ened this week, af­ter Prime Min­is­ter Theresa May’s cab­i­net agreed to set in mo­tion el­e­ments of the UK’S no-deal plans, in­clud­ing re­serv­ing ferry space for es­sen­tial sup­plies, and putting 3,500 mil­i­tary per­son­nel on standby to re­spond to a pos­si­ble no-deal Brexit. The mil­i­tary per­son­nel will in­clude engi­neers, me­chan­ics and driv­ers to be de­ployed for any cri­sis if the UK crashes out of the EU with­out an agree­ment signed.

The dan­ger of a no-deal Brexit comes closer, although Theresa May’s stated top pri­or­ity re­mains to leave the EU on the ba­sis of the deal she agreed with the EU-27, and many MPS be­lieve she is ramp­ing up the no-deal plans partly in order to force them to back her deal in a House of Com­mons vote next month.

What would make a no-deal Brexit even worse than we can imag­ine is that the sort of in­vest­ment re­quired by Ir­ish food com­pa­nies to be com­pletely pre­pared for all events by Brexit (no-deal) Day, March 29, 2019, does not make busi­ness sense, be­cause of the level of un­cer­tainty over the Brexit out­come.

So said Food Drink Ire­land di­rec­tor Paul Kelly at the re­cent Com­mit­tee on Agri­cul­ture de­bate.

He said food and drink com­pa­nies will do what they can, where there is lit­tle or no cost.

How­ever, if sub­stan­tial in­vest­ment is re­quired, most com­pa­nies are not in a po­si­tion to make it, in par­tic­u­lar in low-mar­gin busi­nesses like food and drink.

Pa­tri­cia Callan said the Gov­ern­ment and its agen­cies are “ab­so­lutely not” pre­pared for a no deal Brexit, and are in­stead bank­ing on a deal-brexit, with a tran­si­tion pe­riod avail­able to pre­pare for the fi­nal UK break from the EU. Ms Callan main­tained the Rev­enue Com­mis­sion­ers have no plan for cus­toms on this island. She said plan­ning by the UK au­thor­i­ties is also lack­ing, and warned we will be at the cliff’s edge on March 29, and no one can plan for that.

How­ever, the Gov­ern­ment says 85% of En­ter­prise Ire­land ex­port­ing firms have a Brexit plan, but Brexit pre­pared­ness needs to im­prove among small and medium en­ter­prises that ex­port to the UK. Sem­i­nars are avail­able to ad­vise them on be­com­ing Brexit-ready. Cus­toms train­ing, and low­cost loans are avail­able.

At least 200 new cus­toms of­fi­cials will be in place in March, but can be in­creased to a much greater num­ber for a no-deal Brexit. Ross­lare will need in­fras­truc­tural in­vest­ment, as will Dublin Port and Dublin Air­port, ac­cord­ing to the Gov­ern­ment.

The Taoiseach has said there are plans to pass 45 emer­gency Bills next year in the Oireach­tas if there is a nodeal Brexit. Tá­naiste and Min­is­ter for For­eign Af­fairs and Trade Si­mon Coveney is to pub­lish a frame­work doc­u­ment on Brexit con­tin­gency plan­ning to­day.

How­ever, the truth is no amount of preparation will suf­fice if the UK it­self hasn’t pre­pared fully for a no-deal Br exit. An Ar la Foods UK study of the im­pact on the dairy trade says bor­der vet­eri­nary check work­loads would grow by 372%. Trans­port times would in­crease by 10 hours, with ad­di­tional costs of over £100 per con­tainer.

The UK has the second largest dairy trade deficit in the world, and faces lack of availability of dairy sta­ples in su­per­mar­kets, es­pe­cially of prod­ucts such as spe­cial­ity cheese. Only by wa­ter­ing down the UK’S high food and an­i­mal wel­fare stan­dards could production be ramped up quickly.

“What would make a no-deal Brexit even worse than we can imag­ine is that the in­vest­ment re­quired by Ir­ish food com­pa­nies to be com­pletely pre­pared does not sense make busi­ness”

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