New Brexit Loan Scheme Welcomed By Drinks Industry
The Brexit Loan Scheme launched by the government today (Wednesday March 28) will be an important resource for Ireland’s drinks industry, which faces unique risks associated with Brexit, according to Alcohol Beverage Federation of Ireland (ABFI). The new scheme aims to provide affordable financing to Irish businesses impacted by Brexit. At least 40% of the fund is being put aside for food and drinks businesses.
Director of Alcohol Beverage Federation of Ireland (ABFI) Patricia Callan said, “We welcome the commitment by the government to support funding being made available for businesses in the drinks industry that will be impacted by Brexit.
“In the context of Brexit, we also have particular concerns about the potential negative impact of regulatory divergence and trade border controls.
“Currently the drinks industry operates on an integrated all-island basis. For example, often malted barley might be produced in one jurisdiction and transported to another or beer might be produced in one jurisdiction and transported to another for bottling and canning. These supply chains apply to both agricultural raw materials and packaging but also to the transport of finished alcohol product in duty suspension. As such, it’s vital that seamless cross-border supply chains can be maintained.
“It’s also important that Ireland’s all-island spirits GI’s are protected. Irish Whiskey, Irish Cream Liqueur and Poitín are protected at an EU level in a similar manner to Champagne in France or Parma hams in Italy. This means that these Geographic Indicator (or GI) spirits must be produced on the island of Ireland, in accordance with certain production practices and standards. As this protection covers the ‘island of Ireland’, these products can be made in both Northern Ireland and the Republic. After Brexit, these three Irish spirits GIs will be the only ones to carry such protections where production takes place both in the EU and outside the EU. Therefore, it would be important that Northern Ireland remains fully aligned with the EU with regard to regulatory issues.”
ABFI also warned that the Public Health (Alcohol) Bill in its current form would deter growth and innovation in the drinks industry. This could make the drinks industry even more vulnerable during Brexit negotiations and in the aftermath.
Callan continued, “While on one hand the government is looking to safeguard the drinks industry with measures like the Brexit Loan Scheme, on the other hand it is pushing through the Public Health (Alcohol) Bill which in its current form could undercut the effectiveness of any safeguarding measures being put in place.
“The industry is particularly concerned about the labelling and advertising proposals. The evidence shows that the labelling proposals will make it difficult to introduce new products to the Irish market and will put Ireland at a regulatory divergence from everywhere else in the EU. Additionally, the government’s efforts to severely restrict the promotion and advertising of the drinks industry could deter advertising of craft breweries and distilleries.
“While the drinks industry supports the objectives of the Alcohol Bill – which are to tackle harmful drinking and underage drinking - any measure introduced should be rooted in evidence and should not unfairly impact an important Irish industry, especially as it deals with Brexit turmoil. We believe there is scope for reasonable amendments to the legislation and are calling on the government to balance the bill.”