A no-deal Brexit would have “represented the most significant threat to Irish agriculture in a generation”, according to Minister for Foreign Affairs Simon Coveney.
Speaking at the North Tipperary Irish Farmers’ Association (IFA) county executive annual general meeting last night (Tuesday, January 12), the minister revealed in stark terms the tariffs that would have been in play, had a deal not been struck at the eleventh hour.
The minister attended the virtual IFA AGM after being asked by local senator, Garret Ahearn, and North Tipperary IFA chairwoman Imelda Walsh.
Speaking at the event, Minister Coveney said: “My job over the last three years in many ways was to try and get to a point where we finally got a deal done in the context of the UK leaving the EU.
“That was achieved very late in the day on Christmas Eve.
I don’t think it’s an exaggeration to say that Brexit represented the most significant threat to Irish agriculture in a generation, if we hadn’t managed to get some form of certainty in terms of a future relationship, trade and cooperation agreement.
“What I mean by that is the UK market is so central to agri-food prices in Ireland, because of our reliance on it as by far our biggest export market.
“About 40% of our agri-food exports go to the UK and in the hugely important beef sector, more than half of our beef exports go to the UK – for good reason.
“Because of proximity but also because the UK is one of the highest paying beef markets in the world; and they were part of a common market with us that allowed us to effectively sell beef into the UK as if it was the domestic market here at home.
“Brexit fundamentally disrupts that – not just for beef but for dairy as well and indeed many of the other products, whether it’s primary food products or it’s processed, packaged food that has significant added value before it enters the UK market.
“The danger of course was tariffs primarily and other trade barriers. What we now have is…in essence what we have is a trade deal that avoids tariffs and avoids quotas.
What that essentially means is that we can continue to sell about €5.5 billion worth of food and drink into the UK market without fear of tariff being applied to that product. If we didn’t get a deal, which many predicted as the likely outcome in December, we would have been facing the prospect of paying about €1.5 billion in tariffs on food and drink alone.
Highlighting that tariffs would have amounted to about €750 million on beef alone, the minister pointed out how tight margin beef production is and “how easy it is to slip into loss-making if prices fall even marginally”.
“If we have to pay or somebody had to pay €750 million on a little over €2 billion export trade each year on beef, that could have had a disastrous outcome for our industry,” the minister said.