Labour has won plaudits from industry following party leader Jeremy Corbyn’s call for the UK to commit to a permanent customs union with the EU and to remain a member of Euratom.
Food and Drink Federation director general Ian Wright was among the first to publicly welcome the statement from Corbyn.
“The Leader of the Opposition is correct to highlight the complexities of those supply chains which rely upon barrier-free and tariff-free trade,” remarked Wright.
“The success of UK food and drink manufacturers depends upon the frictionless movement of ingredients and finished products – nowhere is this more stark than on the island of Ireland, where food and drink can cross the border five or six times.”
He added that delays at ports or the border risked disruption to ‘just-in time’ production, potentially adding costs and reducing choice for consumers and shoppers.
“It is essential too that we secure a stable regulatory regime after Brexit which protects the high levels of safe food and drink that UK consumers have come to expect,” he stated.
Failure to secure continued access to the EU’s trade deals could have serious implications for the food and drink industry, with exports to these markets now worth more than £2bn to UK producers.
The Leader of the Opposition is correct to highlight the complexities of those supply chains which rely upon barrier-free and tariff-free trade
Ian Wright, director general, FDF
The EU currently has more than 30 agreements in place with around 60 countries who contributed more than 10% (£2.3bn) of the UK’s total food and drink export figure of over £22bn in 2017.
Of those countries Canada, South Korea, South Africa, Mexico and Norway were the biggest customers. In total, the EU27 and those markets with which the EU has trade agreements contributed over 70% of the UK’s food and drink export value, more than £15bn.
The FDF warned government would need agreements with every third country, and in each case with the EU, that includes the UK share of tariff-rate quotas.
Additionally, said Wright: “We greatly value the expertise from EU agencies such as European Food Safety Authority which ensures rigorous, science and evidence-based policy making, and it is also important we continue to have access to intelligence gathering networks.”
The customs union would ensure common tariffs on imports within the EU member states and reduce friction over goods exchanged across the Republic of Ireland’s border with Northern Ireland.
However, it could involve continued British payments to the EU and compliance with European trade judgements.
Carolyn Fairbairn, director-general of the Confederation of British Industry, traditionally a closer ally to the Conseratives rather than Labour, also praised the Labour stance saying: “The Labour leader’s commitment to a customs union will put jobs and living standards first by remaining in a close economic relationship with the EU. It will help grow trade without accepting freedom of movement or payments to the EU.”
The CBI remarks drew a terse response from minister for international trade Dr Liam Fox who said the UK needed to move away from EU style regulation.
Meanwhile, Corbyn’s statement that Labour backed Britain remaining a member of Euratom, was enthusiastically received by Tom Greatrex, chief executive of the Nuclear Industry Association.
“Seeking to retain the benefits of membership of Euratom and avoid the confusion and uncertainty of a lack of a close association with Euratom, is sensible, pragmatic and in the interests of both the UK and continuing EU,” said Greatrex.
He added that the UK’s civil nuclear sector had consistently stated that remaining a member of Euratom after the UK leaves the European Union is its preferred option.
“The government’s position to replicate the current Euratom arrangements has already proved to be both a time-consuming and uncertain process, and it has only just begun.
“As yet, no new Nuclear Cooperation Agreements (NCAs) have been signed, discussions for a new trading arrangement with the EU have not begun, an agreement on continued involvement in nuclear R&D has not yet been reached.
“Without a transitional period and continued relationship with Euratom, a new safeguarding inspections regime will need to both be agreed and capable of implementation by March 2019 – something the Office of Nuclear Regulation has stated it would not be able to deliver.”