UK government: Brexit creates trade uncertainty

By Alan Osborn

- Last updated on GMT

Elizabeth Truss MP is in favour of voting to remain in a reformed EU. Image from NFU
Elizabeth Truss MP is in favour of voting to remain in a reformed EU. Image from NFU

Related tags: International trade, Eu, Beef, Lamb, Pork, Poultry

The government says an EU exit would create uncertainty for UK farmers and their ability to trade internationally, but the National Farmers’ Union is still undecided on what outcome from the EU referendum would be best for the industry.

Being part of the largest single market in the world outweighs the uncertainties of leaving the EU, according to the secretary of state for the Department of Energy, Food and Rural Affairs (Defra) Elizabeth Truss.

The cabinet minister addressed 1,300 farmers at the NFU conference in Birmingham on Tuesday 23 February.

She said roughly 60% of the UK’s food and farming exports goes to the EU, adding £11bn to the UK economy every year. Leaving Europe, Truss said, will create uncertainty over whether the UK could find a market that compensates for its loss of non-tariff trade and free movement of labour workers.

‘Leap into the dark’

This uncertainty is especially pertinent as the agriculture industry has been hit with a myriad of factors: the continued slowdown of China’s economy, punitive trade restrictions imposed on Europe by Russia and sharply falling prices in pork, lamb, poultry and sugar are all reasons the UK should stay in the EU, Truss said.

At a time of dispiriting price volatility and global market uncertainty, now is not is not the right time to take a “leap into the dark​”, said Truss.

I believe that by voting to remain we can work within a reformed EU to reduce bureaucracy and secure further reform while still enjoying the significant benefits of the single market, which gives us access to 500 million consumers. We are able to export our high-quality products free without the trade barriers we deal with elsewhere and with a say in the rules.​”

‘Intense scrutiny’

The minister has taken the government line on the EU referendum, but the NFU has not disclosed where it stands on the issue. A press spokesman for the union said its official position would be made public sometime in March.

NFU president Meurig Raymond elaborated on this. He said pressing questions over what happens in the event of a yes or no vote remain to be answered. Questions on how the EU would improve trade regulation and ensure the industry is competitive if the UK stays in the EU need to be answered, he said.

It is impossible to measure the impact of being outside of the EU since we do not know the relationship the UK would have, nor the conditions under which its farmers would be expected to operate if we did leave,​” said Raymond.

The UK’s relationship with the EU is under intense scrutiny ahead of the referendum in June. Whatever your view is, there is no denying this is a huge area of uncertainty for farming. And if the vote is to leave the EU there will be at least another two years of uncertainty as new arrangements are negotiated.

I don’t want to be pessimistic. I believe that in the longer term farming prospects are much brighter,” ​he added in an attempt to offset the doom and gloom rhetoric of his speech.

Related topics: Meat

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