Charlie McConalogue (Donegal, Fianna Fail)
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264. To ask the Minister for Agriculture, Food and the Marine the steps he is taking to protect farmers and domestic enterprises in the agrifood sector following the recent Bord Bia report which showed that food exports to the UK were down over €500 million in 2016 due to devaluation of sterling following the Brexit referendum; and if he will make a statement on the matter. [2444/17]

Michael Creed (Cork North West, Fine Gael)
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Bord Bia's recent report estimated that the value of Irish agri-food and drink exports exceeded €11 billion for the first time in 2016 despite challenging international conditions. This is the seventh consecutive year of growth. Bord Bia estimated the potential impact on the value of agri-food exports to the UK last year arising from Brexit at around €570m, based on the value of sterling falling by 13% relative to the euro in 2016. In fact, exports to the UK fell by €360 million (-8%) to €4.1 billion. By contrast, exports to other EU markets grew by 3%; while exports to international markets grew by 13%, driven by strong growth in the Chinese and US markets in particular. Overall the value of exports grew by 2% to €11.15 billion.

While Brexit is a significant new factor, Ireland, as a small open economy which exports the vast bulk of its food production, has always been exposed to international market volatility. We have seen significant commodity price volatility on world markets over the last few years. However, my Department has ensured that measures are in place to help alleviate the pressures of income volatility:

- Direct payments, estimated by Teagasc at an average of over €17,000 per farm, provide a valuable source of farm income support and act as a hedge against price volatility.

- The adjustment in Budget 2017 to the income averaging scheme for tax purposes will allow farmers to avail of an opt-out in an exceptional year.

- The 'Agriculture Cashflow Support Loan Scheme', developed by my Department in cooperation with the Strategic Bank Corporation of Ireland (SBCI), will make €150 million available to farmers throughout Ireland at low-cost interest rates of 2.95%. This is supported by €25 million being provided by my Department, including €11 million in EU aid. The SBCI is aiming to make these loans available by the end of January and I hope to make an announcement in relation to this shortly.

In addition I have made provision for additional funding to Bord Bia both for 2016 and 2017 to address the situation. Indeed the agencies have been active in their response.

- Bord Bia has activated a 4-pillar support strategy for Irish food companies to maintain growth in this period of volatility and over the longer term. These activities are captured under the headings of Managing Volatility, Obtaining Consumer and Market Insight, Deepening Customer Engagement and Extending Market Reach.

- Enterprise Ireland's initial, industry-wide, 5-point plan included provision of information (on improving competitiveness, reducing supply chain costs through the provision of LEAN and R&D/Innovation supports to clients, and accessing funding), market development support and UK market support.

- Both agencies have also been working with individual companies in order to tailor the response in accordance with the particular difficulties being faced, and have been working together on strategic marketing initiatives.

As a consequence of the Brexit referendum I established within my Department a task force who have engaged and will continue to engage, with stakeholders both within Government Departments and the agri food sector to support and protect our valuable food and drink export industry.

In light of the UK vote to leave the EU, Brexit has been included as a standard item on the agenda of each meeting of the High Level Implementation Committee for Food Wise, which I chair. It is clear that driving the implementation of the Food Wise recommendations, particularly those related to market development, competitiveness and innovation, will assume even greater importance in the light of the UK decision.