James Withers, Chief Executive of Scotland Food and Drink, spoke to Brodies' Food and Drink Virtual Conference on 28 October. In a tumultuous year for the sector (as it has been across the economy), with exports down around £1.5bn and a total "hit" to the sector estimated at £3bn, it was heartening to hear about the resilience of Scotland's food and drink businesses in the face of such challenges. The shelves, for the most part, stayed full. Supply chains kept moving. Offices went virtual. Suppliers switched to direct supply when the hospitality sector closed overnight.
James also struck an optimistic note for the future: the big trends that Scotland's food and drink businesses have been riding from strength to strength will still be there on the other side of the pandemic – consumers across the world are still looking, perhaps more than ever, for healthy nutrition, trusted brands, guaranteed provenance, and sustainability (with next year's delayed COP26 conference an opportunity to showcase Scotland to the world).
James had less optimism on the subject of Brexit, where he shared his prediction that the UK would secure, if anything, a basic "no tariffs" deal with the EU that would leave UK businesses having to deal with increased red tape. James's assessment is that political entrenchment means there is no point in businesses or trade groups lobbying for a better deal or deploying economic arguments.
Yet even here James had a message of quiet resolve – it may not be possible to persuade those in government to go for a more comprehensive deal, but that does not mean the sector should simply walk away from advocacy altogether. The argument has to move on – accept what will be will be, as far as a deal goes, but pressure can still be usefully brought to bear on political actors to make the first few months of life fully outside the EU easier. That could, for example, include seeking some form of grace period for the use of labels and markings, including protected geographical indicators, that the sector uses right now. Scotland Food & Drink and ten other organisations representing Scotland's food and drink sector have written to the Prime Minister urging just that. It could also involve lobbying for more comprehensive export support for businesses. If a business decides it wants to sell to customers in the Netherlands or Italy it should be able to call a hotline and be told exactly what it needs to do to export its products to those countries.
We have recently written about customs, VAT and border control challenges for food and drink products post-transition, and how food labelling will be affected by the end of transition. We have also covered a range of other issues that will arise for many businesses at the end of transition, including the food & drink sector, in our Brexit Checklist.
James's key message for the food and drink sector, against a backdrop of Covid-19, Brexit, and whatever comes next was this: Scotland's food and drink sector will get through this. The whisky industry, after all, survived prohibition and two world wars. With determination and the right help, Scotland's food and drink businesses will find practical solutions whatever the obstacles in their way.
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