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WSTA urges new government to strike a full negotiated divorce settlement with EU

Sufficient time is needed to ensure minimum disruption to historic trade flows and grow non-EU trade.

A failed negotiation would be totally unacceptable.

The Chief Executive of the Wine and Spirit Trade Association, Miles Beale, is calling on the Government to pull out all the stops at Brexit talks to avoid the worse possible outcome – a cliff edge “no deal” Brexit.

On the eve of the first formal face to face talks - between the UK’s Brexit Secretary David Davis and the EU’s chief negotiator Michel Barnier - the WSTA is pushing for a full negotiated ‘divorce’ settlement.

The trade association, which represents over 300 of the UK’s wine and spirit businesses, said their members needed sufficient time to prepare their businesses for a post-EU trading environment.

The WSTA warned that Brexit may result in contraction of trade with Europe which will mean the UK needing to look to increase non-EU trading partners, especially through new bilateral free deals with third countries, including improved terms that could only be agreed once the UK has left the customs union. 

WSTA Chief Executive, Miles Beale, said:

“While there has been a great deal of speculation over recent days about what the election result means for Brexit negotiations, the WSTA’s position remains unchanged.  We have long argued for a negotiated deal, including a full ‘divorce” settlement and agreement on the terms of the UK’s future trading relationship with the EU.

“It is essential that the UK secures transitional measures allowing sufficient time for the necessary systems to be introduced and properly tested. Ideally a transition period would allow the UK to agree a Free Trade Agreement with the EU and then to make good progress on other bilateral FTAs with our major trading partners.  Such a transition would give businesses time to prepare fully for a post-EU trading environment.”

The UK is currently the world’s second largest importer of wine by both volume and value. The most important issue for UK wine businesses and the 277,000 UK jobs that the industry supports, directly and indirectly, is for the UK to remain central to world wine trading post-Brexit.

The UK is by far the largest exporter of spirits in the world and the industry which supports some 296,000 UK jobs, directly and indirectly, can only invest and grow if trade flows are secure.

This reflects a fundamental theme in the WSTA’s Brexit policy paper here: to minimise disruption to historic trade flows.

But it would be naïve not to plan for the worst case scenario in which talks break down which is why the WSTA has been working with its members to ensure businesses are prepared and have started to plan and take mitigating action to reduce the impact in the event of trade flows, particularly to and from the EU, being disrupted in the short term.

Miles Beale added:

“Failure to agree terms resulting in a cliff-edge ‘no deal’ Brexit would be the worst possible outcome and totally unacceptable. This would inevitably lead to disruption to trade flows in the short term and significant uncertainty for business in the medium term - until trade deals with the EU and the UK’s other major trading partners could be agreed.

“And I will be taking this exact same message to the 45,000 visitors from 150 countries in Vinexpo, Bordeaux’s international wine and spirit trade show next week. Our industry needs all the European politicians to hear and understand this message from the entire international wine industry. EU politicians have a responsibility to our industry to deliver a Brexit that in no way disrupts the long established trading patterns on which we all rely.”

It’s vitally important too that Government does all it can to minimise the impact of a cliff edge Brexit, including joining the World Wine Trade Group and negotiating bilateral agreements with Australian and the US to replace current EU wine agreements with those countries. 

While it is important to plan for the worst it is also essential to work towards a negotiated outcome.  The WSTA is doing all it can by engaging with our European trading partners, it’s vital that the UK Government does the same.    

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