According to senior executives in the alcoholic drinks sector, a British exit or ‘Brexit’ would have damaging consequences as the EU would probably impose swingeing import tariffs on categories of products, such as whisky, after a UK exit.
“We believe it’s important for the UK to remain part of the EU,” said David Frost, chief executive of the Scotch Whisky Association. “The EU’s single market, including its regulation of food and drink, and its single trade policy, are central to Scotch Whisky’s success.
“The single market lets us trade across the EU simply and easily. The EU’s weight and expertise in international trade helps give us fair access to overseas markets. In all these areas British influence can shape the rules in a way that supports us.”
However, Frost agreed with the government and other industrialists that some reform of the rules would be useful.
“We would like a deeper and freer single market, the elimination of unnecessary national regulations, and for the EU to be even more ambitious and free-trading internationally. We therefore wait to see what the UK government will put on the table in support of its renegotiation plans.”
Including alcoholic beverages, UK exports of food and drink were worth £18.8bn in 2014, of which the largest proportion by far goes to the EU. Exports of whisky globally, the UK's largest food and drink export, although down 7.4% on 2013, were still valued at £4bn.
Renegotiate trade agreements
Following an exit, the UK would also have to renegotiate trade agreements that the EU had with other third countries, said another informed industry source, who wished to remain unnamed.
“Brexit will be very dangerous for us,” he said. “The spectre of an exit even a well-organised one has all sorts of pretty horrible consequences for this industry. It's difficult to think of many food and drink manufacturers that would be genuinely advantaged by a Brexit.”
He noted the free movement of both skilled and shopfloor labour across the EU was also very important to UK food and drink manufacturing, and any restrictions on employment would damage competitiveness for the sector.
Meanwhile, read why one former Brussels boss believes the business impact of quitting the EU has been exaggerated by “scare-mongering” reports.