Irish drinks industry fears "perfect storm" of hard Brexit and 'Beer Burka'

It wants guarantees that health labels and measures that would increase costs will not be introduced...

The prospect of a hard Brexit, combined with the economic consequences of the Public Health Alcohol Bill will badly impact the drinks industry, according to a new study commissioned by the Alcohol Beverage Federation of Ireland (ABFI). 

ABFI is calling on the Government to introduce medium-term policies to protect against this "perfect storm". 

These include a cut in excise duty, a reintroduction of the ban on below-cost selling, assistance in gaining entry to new markets, protections for all-island supply chains and a guarantee that additional costs, including the likes of mandatory health labels, will not be introduced.

The UK is Ireland's biggest export market for food and drink, valued at €4.5bn in 2015 alone. The 20% drop in the value of sterling since the UK referendum on Brexit last summer, and the rising cost of Irish beverages, is cited as a major challenge for the sector in the study.

Agri-food economist Ciaran Fitzgerald, the author of The Impact of Brexit on the Drinks Industry , explained:

"Since the Brexit vote last June and the subsequent decline in the value of sterling, the food and drink sector in Ireland has faced enormous challenges in the short term, including a surge in cross-border shopping."

He also argued that the alcohol bill will also "significantly hamper the exportability of the sector" and "exacerbate pressure on a sector that employs 200,000 directly and indirectly".

Fitzgerald stated:

"The outcome of Brexit negotiations remains unclear. However, it's vital that the Government puts in place a series of policy measures which will support the sector, ensure it gains access to new markets, supports new entrants and protects the unique geographic indicators for Irish whiskey, Irish poitin and Irish cream that we share with the North.”

The study found that beverage exports hit €1.4bn in 139 markets in 2015. The industry's wage bill is over €4bn annually.