UK-EU trade deal must be struck to avoid catastrophic impacts

The FUW has warned that failure by the UK and EU to reach a trade deal before the end of the year would be catastrophic for industries and communities in Wales and across the UK which must be avoided at all costs.

Wales’ food and drink supply chain plays an integral role to the Welsh economy and communities, employing more than 240,000 people in industries with a combined turnover of more than £22 billion.

The EU is the largest and most affluent single market in the world, and 73% of all Welsh food and drink exports are destined for the EU, including the majority of exports of red meat and dairy products worth an estimated £320 million to Wales.

Regardless of whether the UK leaves the EU with or without a deal, industries are preparing to face major challenges from non-tariff barriers at borders to additional costs for agricultural exports and practical implications to the flow of goods.

There is also great concern that talks of an Australia-style trade deal is just a euphemism for a damaging no-deal since former Australian Prime Minister Malcolm Turnbull said that “Australia's relationship with the EU is not one from a trade point of view that I think Britain would want” given that “we obviously are dealing with WTO terms”.

These worrying impacts - including tariffs on agricultural exports in particular - will increase many fold if a trade agreement is not reached. Despite expecting a sense of direction by the 13th December deadline, the fact that trade negotiations were agreed to be extended yet again simply demonstrates how this will go down to the wire.