Industry would ‘suffer monumentally’ with no-deal Brexit

The central role that the UK plays in the global alcohol industry would “suffer monumentally” and be “derailed” in the event of a no-deal Brexit, a leading analyst has said.

The UK officially left the European Union (EU) on 31 January 2020. The UK was granted a transition period until 31 December 2020 to finalise a deal with the EU.

However, with weeks to go until the end of the transition period, the UK government has not yet finalised an agreement.

UK prime minister Boris Johnson is currently in Brussels to try and secure a deal with the EU.

Speaking to The Spirits Business last month, Spiros Malandrakis, head of research – alcoholic drinks, Euromonitor International, said: “At the moment, we still don’t know anything for certain. I don’t underestimate the massive destruction of hard Brexit, but we don’t have any solid information.

“We are weeks away and it is still 50/50 like it has been for the last two years. I don’t want to predict the outcome because it is literally 50/50 and there are too many variables at play.

“But what I can say is that if it is a no-deal Brexit, the central role of London and the UK in the global alcohol industry will suffer monumentally and will be derailed – possibly forever.

“If that doesn’t happen and a relationship is retained [between the UK and the EU], Brexit was always a Trumpian plan, so there’s also this point of view that because of the change in administration in the US, the UK will also be forced to be more pragmatic.”

This week, the UK government said it would suspend the tariffs that the EU imposed on almost US$4 billion worth of EU goods in response to the long-running Airbus and Boeing dispute. This would end the tariffs imposed on US rum, vodka, brandy and vermouth.

The move aimed to show the US the UK was “serious” about ending any trade wars, and reach a trade deal with the US.