UK Prime Minister looks set to cut ties with EU single market

In a potential blow to the Irish agri-food sector, the UK Prime Minister Theresa May looks set to deliver a ‘hard Brexit’ speech later today.

Already movements have been seen in the currency markets, with €1 now buying almost 88p and the possibility of parity between the euro and Sterling cannot be ruled out.

It has been widely anticipated that May will rule out the possibility of the UK remaining a partial or associate member of the European Union – an indication that UK will cut ties with the EU single market.

It is also expected that the UK Prime Minister will reject the possibility of the UK remaining “half in or half out” of the European Union, leaked extracts of her speech reveal.

The trading ties facilitated by the UK’s membership of the EU is of the utmost importance to the Irish agri-food sector and particularly the beef industry.

This is because the UK took 50% of all the beef exported from Ireland in 2016 and 52% of total beef exports in 2015.

Fears have been raised that a ‘hard Brexit’ will see the UK look to countries such as New Zealand or Australia as a source of ‘cheap’ food.

Speaking to Agriland yesterday, ICSA General Secretary Eddie Punch said the implications of a ‘hard Brexit’ could be very significant for the Irish beef industry.

Last week we saw her commit to a free trade deal with New Zealand once Brexit becomes a reality.

“There is a significant number of Brexiteers in the UK who see leaving the EU as an opportunity to import cheap food from Commonwealth countries, such as New Zealand and Australia.

“And, no doubt, the same principle holds where other food exporting nations are concerned, including Brazil, the entire Mercosur group and the US,” he said.

It must also be noted that the UK is Ireland’s largest trading partner for food and drink, with Ireland being the UK’s largest supplier of both.

Some 41% of Irish food and drink exports go to the UK, which is estimated to be worth on the region of €4.4 billion.