- Scotch sales may face trade barriers if U.K. leaves EU: Defra
- Diageo CEO says company `strongly' believes U.K. should stay
More than 1 billion pounds ($1.4 billion) of the U.K.’s scotch whisky exports could be at risk if voters choose to leave the European Union.
Britain may face “bureaucratic barriers” to trade with the EU if it leaves, the Department for Environment, Food and Rural Affairs said in a statement on Monday. Whisky is the U.K.’s biggest food and drink export and the bloc is the single-largest destination, accounting for about 37 percent of sales volume, according to the Scotch Whisky Association, which backs remaining in the EU.
“The industry will do better if we remain in the EU because whisky producers have hassle-free, easy access to the single market,” Environment Secretary Elizabeth Truss said in the statement, before meeting Monday with industry representatives at a Diageo Plc distillery near Edinburgh. “Leaving the EU would be a leap in the dark for our great British food and drink industry and could lead to years of negotiations on new trade deals.”
U.K. exports to countries outside the EU, including South Africa, may also be at risk because the bloc has already negotiated preferential trade agreements and it’s uncertain whether Britain would be able to do the same, according to Defra, as the U.K. department is known. A YouGov poll for ITV television’s “Good Morning Britain” program on Monday found 42 percent of Britons plan to vote to remain in the EU, with 40 percent opting to leave.
Barley, used to make whisky, is the most important cereal crop grown in Scotland, accounting for almost 70 percent of the country’s grain area last year, according to the Scottish government. Prices are little changed this year after falling in March to near the lowest since 2010, data from the U.K.’s Agriculture and Horticulture Development Board show.
Diageo supports the U.K. remaining in the EU, Ivan Menezes, the chief executive officer of the world’s largest distiller, said in the Defra statement. The company owns 29 whisky distilleries in Scotland, according to its website.
“Diageo, and specifically our Scotch whisky business, benefits greatly from the U.K.’s membership of the EU,” Menezes said. “We strongly believe that we should remain within that union.”