James Browne (Wexford, Fianna Fail)
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60. To ask the Minister for Agriculture, Food and the Marine the contingency plans he has in place for future agrifood trade should the UK vote to leave the EU; and if he will make a statement on the matter. [14481/16]

Michael Creed (Cork North West, Fine Gael)
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The prospect of a UK vote to leave the EU presents potentially very significant challenges from a trade perspective, and that is especially true for the Irish agrifood sector. I mentioned earlier that the UK is by far our largest trading partner, with CSO figures indicating that exports of agricultural products in 2015 were worth €5.1 billion and imports €3.8 billion. ESRI and Teagasc reports have highlighted the disproportionate impact that a Brexit is likely to have on the agrifood sector.

My Department has therefore been giving careful consideration to the potential impact, looking at the areas in which the greatest risks are likely to arise and on which we will need to focus if exit negotiations are to commence in the coming months. Although it is still too early to predict the outcome with any certainty, the main areas in which impacts are foreseen are in relation to tariffs and trade, the EU budget, regulations and standards, and customs controls and certification. I would comment briefly again on these areas as follows:

- On tariffs and trade arrangements, including the future direction of UK trade policy, it is clear that potential differences in tariffs could restrict trade in both directions and affect traditional supply practices, particularly for raw materials. Preferential agreements already in place with third countries could require adjustment to take account of a UK withdrawal. A further issue that could arise is the freedom of the UK to negotiate trade agreements with other third countries. This could present a competitiveness challenge for third country suppliers, such as Ireland. However, negotiating such agreements could be a lengthy process.

- On the EU budget, a Brexit would result in the loss of the UK contribution to the EU budget, which currently accounts for some 5-10% of the budget. This could have implications on future spending decisions within an already tight EU budgetary framework, which could place additional pressure on CAP funding in future years, given that it accounts for some 37% of the EU budget.

- On regulations and standards, while this may not have an immediate impact in the event of a Brexit, potential differences could arise over time if the UK takes a different approach to the EU, for example in areas such as origin labelling. This would be a significant issue in terms of additional costs, possible disruption of supply patterns and consumer preferences.

- On customs controls and certification, it is likely that difficulties and additional costs would emerge. It would be expected, as a matter of course, that a UK exit from the EU could see the return of border controls, together with customs and administrative procedures. This undoubtedly would lead to additional administrative costs. Also of concern is that a UK exit would give rise to ongoing certification requirements, which would have significant resource requirements within my Department and significant cost implications for the agrifood industry.

Finally, the possibility of a Brexit also raises issues for the fisheries sector, particularly in the context of the management and sharing of a large number of different fish stocks that we currently share with the UK and other Member States under the Common Fisheries Policy Framework.

Overall, it is in Ireland’s interests for the UK to remain in the EU. However, I and my Department are continuing to reflect on these matters so that we are prepared, if the UK decision is to exit, to establish our priorities for the negotiations in the agrifood and fisheries sectors, and to engage in these negotiations at an early date.