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Ah Brexit. It seems to be everywhere these days, but does anyone really know what’s going on?
Probably not, but we’re here to give you an idea of just what Brexit might mean for Spirits fans.
Paul Skehan, Director General of Spirits Europe stated at the time of the vote, “We respect the British decision to leave the EU, but we also deeply regret it. For our sector, and many others, a strong UK within a strong EU is the scenario offering most certainty and the best prospects for growth.
“This decision will lead to years of uncertainty, with likely knock-on effects on investment, jobs and growth – not only within the UK and EU, but around the world.”
This is a sentiment echoed throughout the Spirits industry, that Brexit will result in years of unknowing and unpredictability. For now, since Article 50 has not yet been triggered and the time frame for leaving the EU looking to be around 2 years, there is only so much speculating that can be done.
The Wine and Spirits industry is one of the biggest in the UK, with 99% of wine sales being imports into Britain as well as the UK being the largest exporter of Spirits in the world, making up 25% of global figures, largely due to Scotch and Gin.
So it’s safe to say the Brexit will definitely have some effect on the industry.
For the most part, those in the Wine and Spirits business were eager for the UK to remain in the EU and before the vote, then-Prime Minister David Cameron warned that the alcohol industry could be hit hard if the UK left the EU.
This was largely due to the fact that international trade deals would have to change and there would be an increase in competition from continental countries such as France and Spain.
With pound taking a plunge after the Brexit vote it would seem that import price would have to rise. This means things like Cognac, Brandy and Wine availability and prices will be affected negatively.
And while the weakness of the pound could be a benefit to Scotch exports, there is the threat of loss of free trade agreements with the EU. The general consensus from the Scotch industry is that Brexit will lead to a lot more complexity in how it is traded and more likely than not prices will increase.
The potential loss of free trade agreements will perhaps have the biggest affect on the Spirits industry, making drinks higher in price and harder to find.
The UK currently has 35 free trade deals with 50 countries, all made with the EU.
The key priority at the minute for the Wine and Spirits industry is that Brexit goes through without an increase in trade tariffs or quota restrictions on EU trade.
The Wine and Spirits Trae Association are urging the government to make decisions that result in as little disruption as possible, but with the Article 50 vote only a month away, it remains to be seen as to whether or not this will actually happen.
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