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The Vital Link in the Food Chain

Date

08 Dec 2020

Sections

Trade & Society

Primary food processors warn on the detrimental effect of a no-deal scenario on their industries. Since the beginning of the negotiations, PFP have supported EU and UK negotiators’ efforts to achieve an ambitious and comprehensive trade deal that provides for the continuation of quotafree and duty-free trade. This is a crucial prerequisite to secure the least disruptive impact on trade and on the food supply chain across the channel.

PFP industries concerned over €2 billion worth of traded goods across the Channel in the balance of inconclusive negotiations.

The EU PFP industries export yearly more than 3 million tonnes of products to the UK for a value of €1,7 billion and import more than 1 million tonnes of products worth €637 million. These trade flows are today highly at risk, as less than a month before the end of the transition period on 31 December 2020, the efforts of negotiators to strike a deal are still ongoing. This situation creates confusion for our industries regarding the aim pursued now, and the timeline for the implementation of such an ambitious FTA.

Our industries continue to support duty-free and quota-free trade across the Channel, and a level playing field providing a fair trade environment. Even if such an ambitious trade agreement is finalised and implemented in due time, businesses will need time to adjust to the new trading conditions between the two blocs.

PFP industries call for an adjustment period to apply for at least 6 months, during which tolerance would allow businesses to adapt to the new requirements resulting either from the implementation of a new trade agreement or as a consequence of the UK leaving the EU Single market. This period would allow progressive adjustment to new regulatory or customs policies, and adaptation to UK procedures and legal requirements (e.g. labelling, certifications, rules of origin).

In case no trade agreement is achieved between the EU and the UK, the breach of supply chains will jeopardise the €2.33 billion value of PFP products yearly traded across the Channel. The immediate cost of duties will weigh on the capacity of businesses to maintain trading activities with suppliers and customers located in the UK, despite long-existing built relationships and interconnected industries.

The PFP industries highlight that in the current challenging economic context, the clarification of eligibility criteria to the Brexit Adjustment Reserve is much needed. The UK is a key export market and represents up to 9% of some sectors’ production outlet.

 

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