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The Irish food and drink industry has warned of serious economic upheaval even if EU and UK negotiators reach an agreement on a free trade deal in the coming days.
Food Drink Ireland, part of IBEC, says the sector is the most exposed part of the country most exposed to Brexit, which is now only 50 days away.
Their report, released today, warns that additional customs procedures, regulatory burdens and rising transportation costs could erode established food supply chains, both in the UK and on the European continent.
Last year, more than 37% of Irish food and drink exports, worth € 4.5 billion, went to the UK market.
In major product areas, no other member state has the same exposure, says the Food Drink Ireland report.
If there is no free trade agreement, significant tariffs will apply to a variety of agri-food products.
Even with an agreement, starting January 1 there will be new paperwork, certification procedures, costs and delays.
This, in turn, would erode the integrated food supply chain penetrating the UK market, but the changes could also hamper supply chains with the European market due to the UK land bridge problem.
FDI realizes that food production is interwoven in all parts of the country and the economy, and provides vital employment throughout the value chain, especially in the agricultural sector.
The disruption of these intermediate investments could have a devastating impact on the overall economy, the report warns.
FDI says the sector will need short-term financial support, investment in competitiveness, an export credit insurance scheme and support to reach new markets in the EU and internationally.
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