CSO figures 'demonstrate need for action to support food exporters'

Food and Drink Industry Ireland (FDII), the IBEC group that represents the Irish food sector, today said that new CSO figures demonstrate the need for the urgent introduction of a state-backed export credit insurance scheme.

CSO external trade figures showed a 13.5% decline in food and drink exports for the first seven months of the year compared with the same period in 2008.

FDII Director Paul Kelly said: “Food and drink companies are suffering, with exports from the sector over the full year likely to be €1bn lower than 2008. The weakness of sterling is having a huge impact as 43% of food and drink exports go to the UK.

"While the currency risk cannot be removed, there are measures that the Government can take to support exports and help companies develop new markets and customers. The Government must move to introduce a state-backed credit insurance scheme. The necessary cover has become unavailable on the private insurance market because of the financial crisis.

"The European Commission has approved measures to allow member states to introduce state-backed schemes to cover financially sound transactions. As a result, many European countries have moved to introduce such schemes to help their exporters. Two key competitors to Ireland, the Netherlands and France, received EU approval for their national schemes earlier this month.

"The absence of a scheme in Ireland puts our exporters at a competitive disadvantage. The food and drink industry is as important to Ireland as the car industry is to Germany. The Government must act now to protect Ireland's most important industry. The sector plays a vital role in the Irish economy, supporting 50,000 jobs directly, 60,000 jobs in distribution and the livelihood of 120,000 farmers.”