WSTA ‘hopeful’ following PM’s Brexit speech

The Wine and Spirit Trade Association says it remains hopeful of a good deal for the UK following the Prime Minister’s ‘hard Brexit’ speech this week.

Yesterday the Prime Minister outlined her plans for the UK withdrawing from the EU in a widely-anticipated speech, in which she made it clear that the UK will not pursue a ‘soft” option that would look to keep the UK in the single-market and its relationship with the custom market was also likely to change, freeing the UK to make its own external trade tariffs. However she said she will push for the “freest possible trade” with the EU, and avoid a ‘cliff-edge’ scenario whereby the UK defaults to WTO tariffs two years after the trigger is pulled.

She told the remaining 27 states: “We want to buy your goods, sell you ours, trade with you as freely as possible, and work with one another to make sure we are all safer, more secure and more prosperous through continued friendship.”

In response, Miles Beale, chief executive of the WSTA, said: “We hope the government succeeds in negotiating the best possible deals for uninterrupted trade with the EU upon leaving the Single Market; and welcome the aim to achieve tariff free access. We also wish to see the government achieve the best possible platform for bilateral trade deals with priority countries, including government recognising the value of industry preparing the ground in advance – as the WSTA has already started to do.

He said the size and the contribution made by the wine and spirit industry – which is worth some £50bn per annum to the UK economy – should not be ignored; and its influence with key trading partners should not be underestimated.

“The UK is a key hub for international wine trade, it is the second largest wine importer by volume (behind Germany) and by value (behind USA), cementing its role as a key international player,” he said. “The UK is also by far the largest exporter of spirits in the world and we hope to see these mutually beneficial flows of trade continue.”

In December the WSTA laid out its objective for the wine and spirit industry in a white paper, stating that one of its fundamental objectives was to support a Brexit that would minimise disruption to historic trade flows into and out of the EU.

It argued that the industry was both highly united and uniquely well-placed to advise government and should be able to lead free trade negotiations to secure the best deals.

In the paper, it called on the government to ensure tariff and quota free access to the EU market in order to maintain the UK’s position as a hub of the international wine trade and that any controls on the movement of people should ensure continued access to a skilled workforce – including winemakers, pickers and the hospitality sector.

It also flagged up the top ten ‘priority’ counties for trade deals which included Australia, Canada, the EU, South Africa and US along with Argentina, Chile, New Zealand for imports, and China, Japan and Singapore for exports.

It has encouraged its members to work with trading partners to develop model agreements with EU and third countries ahead of Article 50 being triggered.

WSTA Chairman Dan Jago said the wine and spirits is facing one of its toughest eras with Brexit posing a “monumental challenge”. 

One of the immediate concern for wine producers, importers and retailers remains the instability and fluctuations in the exchange rate, for although this seems to rally following May’s speech, financial analysts speaking to the Independent newspaper have said it is unlikely to last. But May’s speech has still left many questions unanswered – not least because of the reaction from EU.