Sparks are flying between the EU and UK in the Brexit negotiations. Legislative proposals are being adopted. And some fly in the face of international treaties. These include those regarding Northern Ireland. Boris Johnson and the EU are digging in their heels. All this is now pointing to a no-deal Brexit. Despite that, financial expert, Joost Derks of iBanFirst, notes that the major international banks still expect an eventual agreement. But its margins are shrinking.
Many experts are already mentioning hard knocks for various sectors. These include the chemical, auto, and electrical product industries. For fruit and vegetables, however, Joost foresees fewer issues. "Fruit and vegetables remain a necessary commodity for the UK," says Joost. "The island isn't self-sufficient in its daily fruit and vegetable needs. Any trade barriers, like import tariffs, could drive up these products' prices in the UK."
"And that will eventually be for consumers' bills. The parties are doing everything they can to avoid delays. That's so fruit and vegetable imports are hindered as little as possible at the border. They're, for example, proposing using a system like Portbase. Floriculture's a different story. That's a luxury product, which will be affected by Brexit. Many businesses are exploring new sales markets. That includes those in the fruit and vegetable sector."
There's still much uncertainty in the currency market too. "In the last week, the British Pound has lost some ground against the Euro. That's due to the current difficult negotiations. It's fallen from £0,90 to £0,91 against the Euro. With a deal, the pound could recover by six percent. But, without a deal, it could fall by five percent. The pound's already depreciated by 20% since the 2016 British referendum," says Joost. The Pound's exchange rate will remain volatile until there is final clarity.
The United Kingdom and continental Europe do brisk trading. Brexit will negate these benefits. That also means other countries will be able to compete better with the EU. These include places like Egypt and Morocco. They have a growing fruit and vegetable share. "Still, I don't see this happening any time soon. It's likely that suppliers will start looking at how they can continue their trade after the Brexit."
"That's thanks to the Netherlands' proximity. These parties have been working together for years too." When Joost is asked whether he has any useful tips regarding Brexit for the fruit and vegetable trade, he answers, "Be well-informed about what's going to change for your company. But if you haven't done so yet, it's too late."
For more information:
Joost Derks
iBanFirst
Tel: +31 (0) 858 085 033
Website: [email protected]