Opinion: Brexit and Global Britain

Brexit is no longer a debate about philosophical or practical pros and cons.  The UK has left the EU, surrendering the benefits of club membership for freedom to strike out alone.  It is now keen to draw exporters’ attention to opportunities elsewhere, while enticing the US, Australia and others to come to the table to discuss new free trade arrangements.

This is to be a new era of ‘Global Britain’, to use Boris Johnson’s expression.  What could this mean for UK food exports on the one hand, and those targeting the UK market on the other?

The short term impact on trade has been dramatic. Data released by the Food and Drink Federation show that food and drink exports to EU markets in January 2021 slumped by 65%.  UK imports were also down, but much less starkly. While some of the drop in exports could be accounted for by both stockpiling ahead of the Brexit deadline and the impact of Covid movement restrictions, it’s notable that UK exports to non-EU markets did not show anything like a similar rate of decline.

The reality is that – despite the euphoria at the announcement of an EU/UK Free Trade Deal on Christmas Eve last year – it’s actually the non-tariff barriers in place 8 days later that have done most to snarl up the movement of goods.  SMEs have particularly suffered as many logistics providers halted the groupage arrangements on which so many rely to get their smaller loads onto the Continent.

Many food products now need to get their goods signed off by a vet to obtain an Export Health Certificate, including many composite foods containing meat or dairy.

While on the import side, new UK requirements on EU producers due to come in this month have been postponed, so the full effect of new challenges here is yet to be felt.

It’s clear that the consequences of leaving a trading bloc are going to cause additional friction for all parties. But it’s also probably the case that things may get a little easier in time.  Exporters (and customs officials) will get better at handling the bureaucracy.  And the EU and UK may find ‘clarifications’ which smooth out some of the worst troublespots.

Looking beyond the EU, what does ‘Global Britain’ really mean? To some there are echoes of colonial Britain of yesteryear. To others it implies taking a bigger role on the geopolitical stage, as much as a change in trading focus. In some ways the term seems an accurate descriptor of UK food tastes and orientation. UK consumers are cosmopolitan and eager for new experiences.  Early adopters of ethnic cuisine many decades ago, Brits not only seek out new, challenging and exciting flavours when they eat out (or, nowadays, get food in!), they also expect to find them on supermarket shelves.  A skilled food manufacturing sector adapts recipes for UK tastes, and exports them very successfully too.

The UK has always been and will remain open to both authentic specialities and new product concepts from other markets – whether from the EU or elsewhere.  Seeking out innovation (brand, product formulation, convenience, sustainability) is in our DNA.

As for exports, the EU still dominates, accounting for 61% of total UK food and drink exports. Strip out commodities and it’s a full two-thirds of the total. On the other hand China is the fastest growing destination. But to put that in some perspective, exports to China are not quite half those to The Netherlands.  There is some way to go.

The UK government is bent on demonstrating the benefits of Brexit by striking free trade deals with major markets, to prove it has the clout to achieve ‘better’ or quicker results on its own, than it could by being part of a trading bloc.  Not an easy task. Plenty of bumps in the road and awkward compromises to come.

If Global Britain means anything from a food and drink perspective, then it’s not about favouring the rest of the world over the EU – or indeed proving it can punch above its weight on the world stage. It’s much more about finding markets, both near and far, for UK food innovation, and a genuine openness to source the best the world has to offer for its curious and demanding consumers.

Simon Waring
Managing Director, Green Seed UK
swaring@greenseedgroup.co.uk