Food exports to Britain fall 9% as industry calls for Government help

FOOD exports to Britain were 9% down in February compared with the same month last year, it was revealed yesterday.

Food and Drink Industry Ireland (FDII), the IBEC group that represents the food and drink industry, said Central Statistics Office data reflected the impact the continued weakness of sterling is having on the industry.

FDII director Paul Kelly said the Government must move quickly to provide grant aid for productivity improvements in the industry, set up a state-backed trade credit insurance scheme and reduce high energy prices.

Mr Kelly said it can do this through an emergency review of tariffs and putting in place alternative funding mechanisms for energy infrastructure.

“The weakness of sterling is having a dramatic effect on the industry’s competitiveness in our most important export market, which accounts for 43% (€3.4bn) of Irish food and drink exports. The industry is in crisis with over 2,000 jobs lost already this year. This is a clear indication that sterling weakness is badly hitting the competitiveness of exporters.”

Mr Kelly said the Government needs to urgently get EU approval to set aside state aid rules and provide grant aid to companies to assist them put in place productivity enhancing measures.

“The food and drink industry is as important to Ireland as car industry employment is to Germany. The Government must act now to protect Ireland’s most important industry,” he said.

FDII said the food and drink industry supports 50,000 jobs directly, 60,000 jobs in distribution and the livelihoods of 120,000 farmers.

Gross Value Added in the sector at €8.1bn is almost a quarter of the total for manufacturing.

“However, this understates the true extent to which the sector, by sourcing the majority of its raw materials and services in Ireland, is embedded in the Irish economy.

“Expenditure by the sector is over 75% of total expenditure, compared with less than 40% for the rest of manufacturing.”