The head of the Food and Drink Federation (FDF) has called on the new Prime Minister Boris Johnson to avoid a potentially damaging no-deal Brexit.
“The industry’s recently published ‘Plan for Success’ demonstrates how we can make the UK’s £4bn food chain the most dynamic, sustainable and competitive in the world. It shows how – working in partnership with Government – we can boost exports, develop talent and encourage innovation,” said FDF Chief Executive Ian Wright.
“A no-deal Brexit would destroy that opportunity and much more. It will inflict serious and – in some cases mortal – damage on UK food and drink. Prices will rise, there will be significant shortages of some products, and disruption for shoppers and consumers will be far reaching. We urge the new Prime Minister and Government to work with us to deliver a withdrawal agreement that guarantees the closest possible trade and regulatory relationship with our nearest neighbours so UK food and drink can flourish.”
From a retail perspective, Thomas Brereton, Retail Analyst for GlobalData, commented: “The most pressing issue for retailers remains clarification on Brexit, both in terms of timing and the nature of the withdrawal. But numerous retailers – particularly the supermarkets – have expressed concerns over an October deadline, anxious about the potential increased pressure to supply chains and storage space coinciding with Halloween and preparation for the busy Christmas period. Boris’s appointment has seen the probability of a no-deal Brexit rise to c.25-30%*, augmenting concerns over the supply of fresh food, toys and essentials such as pharmaceuticals and contraceptives. In response, he must now make swift progress in bringing a withdrawal agreement to the table to allay retailer’s concerns.
“Retailers will also be watching to see if Mr. Johnson can stimulate consumer confidence. GlobalData’s July Consumer Sentiment Tracker shows both future and present sentiment declining from the previous month, and despite being marginally higher than the lows witnessed at the start of 2019, this will likely worsen as we approach October if the Government fails to provide clarification over Brexit.
“Outside of Brexit, the British Retail Consortium and retailers including Tesco, Sainsbury’s and Next are becoming ever more vocal about the destructive impact of business rates on physical retailers. But while Boris has called for cuts to business rates alongside corporation tax during his campaign, details of this potential move have not been provided, and we do not expect him to make the bold changes that the retailers require.”
