New trade agreements are vital for the food and drink industry to continue to thrive in the wake of the Brexit vote, says David Thomson
Scotland’s food and drink industry is a great success story both at home and abroad. Food and drink manufacturing is the largest manufacturing industry in both Scotland and the rest of the UK. In Scotland, the 875 businesses that make up the sector provide 34,000 jobs – 19 per cent of all manufacturing jobs and contribute £1.7 billion in gross value added to the economy.
In the aftermath of the decision to leave the EU, the key issue has been uncertainty. Markets have reacted, exchange rates have fluctuated. With a clear majority of the Scottish people wishing to remain in the EU, as I write there is a good chance that a further Scottish independence referendum will follow. This potential creates even more uncertainty for businesses.
In truth, all bets seem to be off. The rules are unclear and the pathway forward is uncharted.
This is where trade associations play an important part. The Scottish Food and Drink Federation (SFDF), and at UK level the Food and Drink Federation, will be there as ever to help our members through this challenging period.
We are focusing on working with the UK and Scottish governments to understand what the vote to leave the EU will mean for our workforce, trading, market access, food safety and regulation. Most of our members benefit in some way from the open market whether they export to the EU, source ingredients or materials from there or, as in many cases, rely on talented workers from other EU countries.
While we as an industry continue to take many steps to develop home-grown talent through ambitious graduate and apprenticeship programmes, EU workers also provide a highly valued solution to our skills gap. We urgently need assurances that EU nationals working in the UK will be granted leave to remain. The UK government must now develop a new migration policy that ensures food and drink manufacturers have continued access to the workers we will need.
New trade agreements must be a priority, especially a deal securing continued tariff-free access to the EU which currently accounts for around 70 per cent of UK’s food and non-alcoholic drink exports and imports.
Research funding is another benefit our members gain from being part of the EU. To innovate and remain competitive food and drink companies depend upon on this in particular through our universities. Where will this funding come from when we leave the EU? It is important more than ever that SFDF works with industry partners across the food supply chain and Scottish Government to ensure our industry continues to grow and prosper even in these difficult times.
• David Thomson is chief executive of the Scottish Food and Drink Federation