Following the UK referendum on European Union (EU) membership, the United Kingdom of Great Britain and Northern Ireland is scheduled to leave the EU on 31st October 2019. This has the potential to disrupt many businesses, but a new trade deal has been struck by the British government which will allow all UK businesses to continue to trade on preferential terms with the Mozambique and the Southern African Customs Union (consisting of South Africa, Botswana, Lesotho, Namibia, Eswatini and Mozambique) following the UKs departure.
The focus on the deal with regards to Northern Ireland (NI) is because without this deal, Irish whiskey from Northern Ireland would have faced a tariff of 154 cents per litre post-Brexit, plus additional taxes, which it currently doesn’t face and would mean a sharp division in costs in the Irish whiskey industry. This would have had an immediate impact on large distilleries such as Bushmills as well as smaller, newer distilleries such as Echlinville and Killowen as they grow and expand into new markets.
William Lavelle, head of Drinks Ireland and the Irish Whiskey Association, said:
“South Africa is currently the fifth largest export market for Irish whiskey while sub-Saharan Africa is proving to be a major growth region for our category.
“Thanks to the existing EU agreement with the Southern African Customs Union, there are currently zero tariffs on Irish whiskey exports to South Africa and other markets in the union.”