Speaking at this year's Scotsman Food and Drink Conference at the Royal Bank of Scotland Conference Centre in the Capital’s Gogarburn district, entitled Without Boundaries – Scotland’s Future in the Food and Drink Industry, Mr Withers also said that if the UK does leave the EU without a deal, he suspects that Scotland will have an independence referendum within 18 months.
He said: “We know for some products like Scotch beef and Scotch lamb, the tariff would effectively close down that market, unless government was willing to effectively compensate the industry for the price of the tariff in perpetuity – which I imagine it won’t.
“For other products where the tariff won’t kill the market on its own, the challenge of disruption at ports for products that are perishable – such as seafood – alongside the additional bureaucratic costs where Scotland issues 15,000 export certificates a year, it’s suddenly going to have to produce up to 150,000 – we don’t have the staff or the money to do that, so the system will fall down.
“So, this export progress we’ve been building for the last ten years will have, certainly in Europe, the rug pulled from underneath it in the short term and, for some products, the long term. If we leave with a no-deal, I suspect we will have an independence referendum within 18 months, and all of this matters because it completely dominates and affects the environment we work within.”
Adding that though this was all outwith the industry’s control, Mr Withers stated that the industry is still optimistic about achieving Ambition 2030, with the investment in skills, sustainability and technology and the building of Brand Scotland meaning that our current food and drink model remains the envy of many countries around the world.
Indeed, he said he found it incredible that recently the UK Government had debated whether the food and drink sector even matters, comparing this stance to Scotland, where the industry’s unified approach has seen it grow to be worth almost £15 billion per annum, accounting for one in five of the country’s manufacturing jobs.
The Scotland Food and Drink chief told the conference: “In a world where we talk about sustainable food production, what a phenomenal opportunity Scotland has going forward. We are going to have to work hard, but could we become the first country in the world recognised by the UN for having a zero-carbon food industry?
“Potentially, if we then build that into our brand and we embrace the technology to reach our customers easier and focus all of our effort on telling our story, as well as having the baseline of a home market and increasing aspirations on the global market, then there’s no reason why we can’t survive the Brexit era and enter into a golden era over the next few years.”
His optimism was mirrored by The Scotsman’s conference partners, the Royal Bank of Scotland, as its Purchasing Managers’ Index (PMI) was released on the day of the event and forecasts bright prospects for the country’s strongest sector.
John Mills, director, corporate and commercial at Royal Bank of Scotland, told delegates: “More than 200 business representatives from across the country attended today’s event, and at such a marked time for UK politics and business, this was a great opportunity to bring together some of the key voices within the sector and enable individuals to discuss what the industry is facing and what it is achieving.
“Our new food and drink PMI emphasises the industry’s success and shows that the Scottish food and drink sector has outperformed the rest of the Scottish economy each year for the last decade.”
Indeed, the report set out this fact in black and white and informed its readers that, with a “footprint of successful exporters spanning the length and breadth of Scotland”, food and drink manufacturers remain a “critical engine of economic growth” for the country.
Sebastian Burnside, Royal Bank of Scotland’s chief economist, added: “In a world where growth has become harder to find, the food and drink sector makes a refreshing change and really stands out.
“Scotland’s brand, at home and abroad, is a vital asset, and the food and drink sector has both harnessed and helped build its value. These are great foundations for further growth as we look to the future.”