Category: Business News

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NHS

Relations with the United States were always going to be a high priority for British trade policy post-Brexit.

So no surprise that Liam Fox has gone to Washington to discuss prospects.

The International Trade Secretary is pushing for a bilateral trade liberalisation agreement with the US to take effect when the UK leaves the EU.

And his American hosts seem well disposed to the idea in principle. Better access to the US market would go down well among many UK businesses too.

It is, after all the UK’s largest single export market, though well behind the rest of the EU taken together.

The US is also the second largest foreign supplier to the UK. So a freer trade relationship could reduce the cost of those imports.

Priority

There was also a great deal of enthusiasm among British business for the EU’s negotiations with the US, a project known as the Transatlantic Trade and Investment Partnership (TTIP).

Now that British business won’t be able to make use of any benefits that might come from that exercise, if it is ever completed, a deal with the US would be helpful for many.

Having said that, many regard it as a higher priority to preserve trade access to the EU as far as possible on existing terms. That is broadly the position of a number of British business lobbies.

There are some areas of any UK/US talks that might be difficult. Experience with the TTIP negotiations gives some clues as to the kind pressures the British government is likely to face at home.

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Science Photo Library

One is resolving disputes under the agreement, particularly any involving foreign investors.

Many trade and investment agreements provide for tribunals to be established if a foreign investor believes their interests have been harmed by the host government acting in a way that contravenes the agreement.

They can seek financial compensation, and there are many cases where they have been successful. The system is known as investor state dispute settlement (ISDS).

It has been around for decades, but has become more controversial in recent years. Critics see it as giving international businesses unfair leverage over the policies of elected governments.

NHS impact

There will be business lobbies on both sides keen to see some sort of arrangement along these lines and campaigners vigorously opposed.

There is a particular issue for some groups in the UK about how this might affect the National Health Service. It came up in the context of the TTIP negotiations.

The issue was partly whether the agreement might force the British government to privatise health service provision – and also about whether the agreement would make it hard or impossible to reverse any privatisation that did occur.

The issue was that reversing such a move could deprive a foreign health company of business, which campaigners argued could enable it to use the ISDS tribunal system to seek compensation from the host (British) government.

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Reuters

The US has some big healthcare businesses which would be keen to establish a stronger presence in the UK. How well founded that fear would be would depend on the wording of the agreement, but once detailed negotiations get underway it’s likely to be brought up.

Chlorine and hormones

In the context of TTIP, the idea that it would compromise public provision of healthcare was robustly rejected by, among others the British government, but campaigners did not accept that.

Then there are food issues. Dr Fox has already responded to concerns about American chicken washed with chlorine. That came up in the TTIP talks too and it might well make an appearance again. The practice is widely used in the US to remove microbial contamination, but it is not permitted in the UK.

Beef fed with growth promoting hormones, another practice used in the US, could also be difficult. It’s banned in the EU on the basis of health concerns.

This is a trade dispute that has rumbled on for many years and the EU has lost the case in the World Trade Organization, which accepted that the hormones were safe.

The EU has never complied with that ruling and still bans such meat.

Genetically modified approvals

Another food issue is genetically modified crops. They do have a presence in the European food chain, partly through animal feed. But the approval process for new GM crops is seen by US farm groups as excessively slow and cumbersome.

Movement on all three of these issues is likely to be important for US negotiators. The National Farmers’ Union in the UK is receptive to the idea of reforming the GM approvals process, but the other two are more of a problem.

Nonetheless there are certainly opportunities that businesses in both countries can see. For industry, the relatively straightforward area is tariffs, taxes on imported goods.

They are relatively low in both the US and the UK (which currently adopts the EU’s tariff policy). But there are some goods for which they are relatively high (10% for cars entering the UK from outside the EU, for example).

Many industry and financial services groups would also welcome closer regulatory cooperation. It would simplify business for suppliers and could conceivably lower costs for customers.

In any event, for now the UK remains a member of the EU and its common trade policy.

But that certainly doesn’t stop negotiators discussing what a post-Brexit deal would look like.

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Varkey Foundation

As a little girl growing up in rural Nova Scotia in Canada, Maggie MacDonnell was worried by locals gossiping about the Mi’kmaq indigenous people who lived on a nearby reserve. They said the Mi’kmaq were trapping on her family’s land.

She recalls: “I went to my dad, a huge man, six foot something and in the woods a lot, and said, ‘Dad you’ve got to watch out, the Mi’kmaq are hunting on our land.’

“He looked at me and responded, not in a chastising way, ‘This is their land and we always have to remember that. They can hunt and fish and trap anywhere they want. We are guests on their land.’”

This year Maggie MacDonnell was named as winner of the Global Teacher Prize – and she links this accolade with these attitudes in her early years.

“I was lucky to have that influence at an early age,” she explains.

“Because maybe other kids didn’t go home and have that conversation with their parents, maybe they had a more prejudiced conversation.”

Meeting presidents

Ms MacDonnell’s understanding of the injustices meted out to Canada’s indigenous people helped her work with students at Ikusik School in the 1,400-strong Inuit village of Salluit in northern Quebec on the Arctic circle.

It’s an isolated place, accessible only by air, where young people have few job opportunities and where there have been problems with high levels of drink and drug abuse and shocking levels of suicide among teenagers.

At the award ceremony she spoke movingly of the experience of teaching in a school after a funeral of one of the students.

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Varkey Foundation

Her success was also remarkable because she had not even heard of the teaching prize, run by the Varkey Foundation, until she was nominated for it.

Sunny Varkey, founder of the Varkey Foundation, said she won the prize because of her “superhuman” tenacity in wanting to improve the chances of her students in Salluit.

“There are no roads to get there, the climate is tough and these communities are living with the legacy of generations of inequality.

“Due to the harsh conditions, where temperatures can reach -25C in winter, there are very high rates of teacher turnover, which is a significant barrier to education in the Arctic,” said Mr Varkey.

“Many teachers leave their post after six months and many apply for stress leave, but Maggie has stayed on for six years, painstakingly building bonds with her students and instilling them with hope,” he said.

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But since the awards ceremony in Dubai in March, Ms MacDonnell has used the prize to highlight the needs of her students.

She took Inuit students and teachers to the Toronto Film Festival to show and discuss the documentary film Salluit Run Club about the running club she set up to try to build up the resilience of her students and the local community.

“The young people I brought opened up all sorts of conversations for parents to have with their kids on indigenous issues in Canada. It was awesome,” she says.

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Reuters

Two of her students went to the United Nations in New York for a one-hour conversation with former US president Bill Clinton.

On a visit to Chile, two students met the country’s president, Michelle Bachelet, and were guests of the indigenous Mapuche people.

President Bachelet publicly asked the Mapuche and other indigenous people for forgiveness for the historic injustices.

“That was an amazing moment for the Inuit youth who I work with to witness and be part of,” said Ms MacDonnell.

Pressure on indigenous people

Last week, thanks to the funding from the prize, she took four young Inuit people to her own home turf of Nova Scotia to take part in her newest initiative, a kayaking project.

It is a one-week course designed to give them a basic kayaking certification to build their confidence on the water.

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Varkey Foundation

The kayak is a potent Inuit symbol. It once enjoyed a more prominent place before pressures like enforced residential schools separated Inuit youth from traditional cultural and economic roles.

It was an emotional visit. There were already connections in place. Her social worker sister Claire has adopted two Inuit children from her time in Salluit (she was there before Maggie), and her mother had also visited the village.

Maggie’s work and her prize have helped highlight the struggle of Canada’s indigenous peoples.

Canada has been marking its 150th anniversary – Canada 150 – and as part of this commemoration prime minister Justin Trudeau highlighted the “victims of oppression”.

“As a society, we must acknowledge past mistakes,” said Mr Trudeau, about the need to acknowledge previous wrongs to indigenous people and to achieve future reconciliation.

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The comment chimes with Maggie MacDonnell’s teaching experience. Her Inuit community has been in the region for thousands of years, and the past 150 have not been kind to them, so even those who are proud Canadians may have had trouble celebrating Canada 150.

The Nunavik region, made up of 14 villages that include Salluit, suffers from a chronic housing shortage.

This exacerbates other problems which include alcohol and drug dependency and a high rate of tuberculosis.

Maggie MacDonnell’s work with indigenous people in Canada also has resonances elsewhere.

Global warming

She has worked in Tanzania and wants to take Inuit students to climb Mount Kilimanjaro with local youth “to bring more attention to an African symbol of climate change, because on Kilimanjaro the glaciers are melting”.

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Global education

Ideas for the Global education series? Get in touch.

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Her own community is already aware of the impact of global warming. Her students posted on Facebook a picture with a brown bear taken locally.

“That’s ridiculous,” she says, “like seeing a giraffe walk through London.” They are usually found much further to the south.

“We need to collaborate on a global level,” she said. “There are opportunities to weave together global issues, particularly for indigenous people, and especially climate change, social justice, gender empowerment.”

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The ambitions may stretch internationally, but Maggie MacDonnell’s work is firmly grounded in her community.

On the theme of Canada 150 she said: “I guess you can say that education does offer opportunities for reconciliation.

“I think that if Canada can seize this opportunity and become a global leader and an example for healing relationships between our indigenous and non-indigenous people, that’s when we are going to be a truly developed country.

“I wish that all Canadians could see the benefit of how we would all be richer, not just economically, when we really start to value and ensure that indigenous people can unlock their full potential.

“What Canada could look like then would be phenomenal. When we embrace all that diversity and all those different outlooks, that’s what would make Canada so exciting.

“Canada 300 – a really great party that I’d like to come back to if possible.”

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Kate Spade

It’s easy to miss. The words “on purpose” are printed on a small label inside the tote bag alongside the name of the woman who made it.

It sits inconspicuously next to the other handbags on the shelves at high-end fashion brand Kate Spade.

There is nothing notably different about it.

Yet it was made in a factory that doesn’t have a reliable source of running water, where the electricity routinely cuts out, and where, until relatively recently, the workers didn’t have the necessary manufacturing skills.

It’s in a tiny village called Masoro in landlocked Rwanda.

There are no dependable roads, which means all the products made here have to be airlifted out – a much more expensive option than the usual way of sending them by ship.

And perhaps most unusually, this factory didn’t exist at all until global fashion firm Kate Spade decided to open it and fund its creation just over three years ago.

The obvious question is: Why?

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Kate Spade

“We like to stretch ourselves,” laughs Mary Beech, chief marketing officer at the firm.

She says as a brand that makes clothing and handbags for women, and whose employees are mainly female, doing something to help empower women “came very naturally”.

The branding of the product is subtle, says Ms Beech, because they don’t want it to be a token charity product.

“We want women to buy these bags because they walk into the store and love them. First and foremost it has to be a beautiful product which is completely natural and integrated,” she adds.

Rwanda’s horrifying 1994 genocide, when 800,000 Rwandans were killed, continues to affect people today, and Kate Spade says this history was an added incentive for choosing the location.

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Kate Spade

Of course, many brands undertake charitable projects.

Fashion firm Asos, for example, sells a “Made In Kenya” range produced by local clothing manufacturer Soko, which it says aims to support local craftsmanship.

Similarly, footwear firms Toms and Roma Boots both give away a pair of shoes to a child in need for each pair they sell.

The difference with Kate Spade’s charitable initiative On Purpose, the firm says, is that it’s a business venture that had to make commercial as well as emotional sense.

“It couldn’t be a crafty aside done for corporate social responsibility that didn’t tie back into economic sustainability,” says Taryn Bird, senior manager of the On Purpose initiative.

She said this was because the firm wanted to set up something that lasted and enabled the factory to be financially independent, eventually taking orders from other fashion brands and becoming part of the global supply chain.

The only way to make sure this happened, was to set it up themselves, says Ms Bird.

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Katie Spade

The factory is not owned by Kate Spade, but is an official supplier. The people who work there – around 150 – are employed by Abahizi Dushyigikirane Corporation, known as ADC.

So is this just exploiting Rwanda’s low-wage economy?

Kate Spade says not, pointing out even the lowest paid worker’s salary in the country is considerably higher than the median salary for private sector jobs in Rwanda.

It has also set up a life skills programme at the company, offering counselling, information on health and nutrition and English language lessons.

While the firm won’t be drawn on how much exactly it ploughed into the factory to get it going, Ms Beech says it was “a minimal investment”. Almost four years on she says they are “on track” to get their investment back and for the factory to become profitable. The staff retention rate is an impressive 98%.

But Africa is not such an unusual choice for a firm looking to diversify its supplier base.

Labour costs are already much lower than in China. According to Georgetown University in Washington, which studied the Kate Spade project, staff in factories in coastal China earned around $700 (£537) a month, over six times the average $113 monthly salary at the ADC factory.

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Kate Spade

Africa also offers what Ms Bird describes as “a very business friendly climate for export companies”.

ADC does not have to pay duties on incoming raw materials and is also able to export the finished bags to the US without tariffs.

In contrast, tariffs on handbags from Asian suppliers range from 4.5% to 17.5%, according to Georgetown University.

So Africa has the potential to become the world’s next low-cost manufacturing hub thanks to a cheap workforce and an abundance of raw materials. A lot of production has moved there already.

Ms Beech, however, says that wasn’t why Kate Spade chose Rwanda. The bags made there were additional orders reflecting increased demand for its products.

Pietra Rivoli, a professor teaching finance and international business at Georgetown University, and part of the team which researched the project, says it proves it’s possible to put a factory anywhere.

“The set up was not terribly complex. It’s not something that other companies could not do given the motivation and support from management,” she says.

She says the supportive factory set-up made ADC feel very different to any other factory she had visited.

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Kate Spade

“I’m not saying other factories are somehow bad. But most supplier relationships tend to be very transactional. The relationship is one of monitoring for labour abuses, whereas the ADC approach is a much more positive philosophy.”

Typically, how cheaply and quickly something can be made are the main criteria a company uses for deciding where to locate a factory.

Prof Rivoli says the Kate Spade example offers “a demonstrative case study” of an alternative approach.

“What they have shown is that it can really be a win-win. The factory can pay the company back [for the set-up costs] and the firm can support the worker and their communities.

So far it’s one small-scale experiment. But Kate Spade says it is already planning to pilot a second factory in a different developing country in the next couple of years.

“This time we’ll make sure it has access to a port,” laughs Ms Beech.

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Global Trade

More from the BBC’s series taking an international perspective on trade:

Where’s hot? This summer’s most popular holiday spots

The lucrative world of ‘the super tutor’

How the ‘better burger’ is taking over the world

What it takes to get Beyonce on a world tour

The country losing out in the breakfast juice battle

Why a $1.6bn car plant has been left to decay

Read more global trade series here.

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Snow, more snow and Santa Claus. Utter the word “Lapland” and you might imagine a place where it’s Christmas all year round.

But due to its location, largely within the Arctic Circle, Lapland has extreme seasonal variations in climate. While it can be freezing cold for much of the year, visit in spring and summer and you’ll witness permanent sunlight and warm temperatures, sometimes reaching 30C.

For those inhabiting this region, which spans parts of northern Norway, Sweden, Finland and Russia, being able to adapt is key and no more so than when it comes to earning a living.

Take for example Swedish Lapland. Traditionally the endless light of summer was a crucial time for getting jobs done before the inhospitable winters set in and the lightest time of year still plays a big role in people’s lives.

Mikael Suorra is from the indigenous Sami population and has grown up around the reindeer, brown bears, eagles and elk that roam this part of the world.

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Mikael Suorra

From a base near Harads, around 30 miles south of the Arctic Circle, Mr Suorra runs nature tour company Hide & See which takes tourists on local safari trips. He says the months from May to August are perfect for spotting brown bears.

“Bears are active at night and at this time of the year you can see them all day and night; even at 1am the light is good.”

Mikael has built a six-person hide right in the middle of an ancient pine forest so that visitors can get the perfect camera shot of one of the region’s most revered creatures.

Visitors aren’t guaranteed to spot a bear – this is still a largely untamed wilderness and there are no certainties. However, even though guests pay around £300 per person, Mikael says that his visitors don’t mind if they don’t encounter one of these majestic animals.

“They often come here for the quietness and beauty of their surroundings and if they see a bear it’s a bonus.”

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Elizabeth Hotson

The stunning natural beauty of Lapland doesn’t just offer opportunities to local business people. Every summer Jay Bartlett, a Reading native, runs Fly Fish Adventures which offers salmon fishing trips for enthusiasts keen to reel in a prize specimen.

The Briton charges up to £1,250 a week but says this is comparatively cheap.

“Historically this kind of fishing’s been expensive and in parts of America, Canada and Russia you can spend a hell of a lot more.”

Wading into the River Torne at Kengis Bruk, just before midnight, Jay casts off, hoping for that magical tug on the end of his line. Surely though, even in the quest for the ultimate catch, fishing in the middle of the night is a bit extreme?

“When you have 24-hour sunlight it’s difficult to go to bed when you know the fish of a lifetime is in the river,” says Jay. “It also makes practical sense. During summer, daytime temperatures can get pretty high but the optimal is around 12-13C. Those conditions are most likely in the middle of the night.”

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Asaf Kliger

The salmon season runs from the beginning of June to the end of August and for the rest of the time Jay is back home in Reading drumming up trade for his trips. However, he says he “counts the days” until he can go back again in June.

Tourism is an increasingly important part of Northern Sweden’s economy, and up in Jukkasjarvi, 125 miles north of the Arctic Circle, the Ice Hotel has found a novel way of capitalising on this.

Every year around December the firm constructs a hotel from blocks of metre-thick ice from the River Torne, although come spring it melts away.

This year, however, the company launched a second ice hotel that stays open all year round, ironically by harnessing the power of sunlight.

The ice on the exterior of IceHotel 365 does melt during the summer months, but the interior remains frozen thanks to a cooling system powered by solar panels.

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Elizabeth Hotson

“Every summer people turn up expecting to see the Ice Hotel but of course it’s already disappeared,” says hotel guide Ellen Rye-Danjelsson.

“But at the new hotel we can keep the temperature at between -5C and -8C all year round.”

Sleeping surrounded by ice in the middle of summer may seem counterintuitive but this part of the world is full of surprises.

Take Per Pesula’s farm in Kukkola, which is right next to the River Torne, which divides Sweden and Finland. Up here, a few miles south of the Arctic Circle, Mr Pesula lays claim to being the world’s most northerly producer of cooking oil.

“People are shocked when I tell them I grow rapeseed and mustard but because of our geographical position we have an extra growing month. In the summer the 24/7 light means that the rapeseed shoots up by 2cm a day.”

At his farm gift shop, Mr Pesula tells that me his burgeoning business produces around 12,000 litres of rapeseed oil a year as well as homemade mustard.

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Mikael Suorra

“We use 5,000 litres of the oil to power the farm machinery and I sell the rest to visitors and local supermarkets. When we’ve finished the pressing we use the by-product for cattle feed instead of importing soy from Brazil.”

In autumn and winter the number of daylight hours falls dramatically and Lapland businesses must adapt. But for some locals the transition can be hard.

Stockholm-based occupational psychiatrist Royne Strand says that the extremes of 24-hour light in the summer and almost permanent darkness in winter can cause psychological problems.

“Some people aren’t affected by the darkness but others really suffer. We see depression, stress-related disorders and many people don’t perform as well at work.”

The opposite can also be true.

“I also have patients who get depressed when the light comes. There is a huge expectation to get everything done and the pressure to make up for lost time.”

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Leon Neal/Getty

Trade talks, tense affairs at the best of times, often get particularly sticky when it comes to food.

When the UK starts to negotiate new trade deals as it leaves the EU in 2019, food will be one of many areas that will need to be addressed.

The ongoing spat over chlorine chicken highlights how tastes and safety practices around the world can differ hugely.

What might seem normal practice in one country can seem problematic elsewhere.

In the US, it is legal to wash chicken carcasses in chlorinated water to kill germs – but this has been banned in the EU since 1997.

UK Environment Secretary Michael Gove has said the UK should not allow these imports in a post-Brexit trade deal with the US, but Trade Secretary Liam Fox says the practice is “perfectly safe”.

Anthony Scaramucci, US president Donald Trump’s new communications director, told BBC Newsnight that there would “100%” be a trade deal between his country and the UK – although he confessed he had no idea what was happening about chlorinated chicken.

Here are five occasions when spats over food have made past trade talks tricky.

‘Infested’ avocados – Mexico v US (1914-97)

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TOBIAS SCHWARZ

For more than 80 years, the US refused to import Mexican avocados on the grounds that the fruit was infested with fruit flies and other bugs.

After the signing of the North American Free Trade Agreement (Nafta) in 1994, the US came under pressure to relax its ban, rather than rely on its pricier home-grown avocados.

“Avocados are always used as a pawn in the trading process. Whenever the United States talks to Mexico about opening up other agricultural commodities to US growers… it always comes back to avocados,” Jerome Steyhle, who chairs the California Avocado Growers Commission, told the BBC in 2003.

In 1997, the restrictions started to be lifted, and by 2016 the US was importing 1.7 billion avocados across the border each year, according to marketing group Avocados from Mexico.

But the avocado war could be reignited now that President Trump has threatened to renegotiate Nafta – which he described as “the single worst trade deal ever approved [by the United States]”.

Earlier this year, there were reports of several Mexican avocado lorries being turned away at the border following an argument about US potato imports.

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Beef wars – US v EU (1988-present)

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Lisa Lake

One of the best known food-related trade disputes was over hormone-fed beef.

The use of certain growth hormones in cattle rearing is legal in the US.

But in 1988, the EU banned the use of several major growth promotion hormones, which it said posed a potential risk to human health. This was an effective ban on American beef.

A decade later, the World Trade Organization (WTO) ruled the EU’s refusal to import US beef was not based on scientific evidence and violated its members’ obligations.

However, the trading bloc still wouldn’t buy the meat, leading the US to retaliate by levying higher trade tariffs on some of its EU imports.

“American ranchers raise some of the best beef on the planet, but restrictive European Union policies continue to deny EU consumers access to US beef at affordable prices. For several years we have been asking the EU to fix an agreement that is clearly broken, despite its original promise to provide a favourable market for US beef,” US Agriculture Secretary Tom Vilsack said last year.

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Stockpiling food – India v US/WTO (2013-14)

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PRAKASH SINGH

Several years ago, India blocked the implementation of a 2013 global trade agreement it feared would stop it stockpiling food for the poor.

India refused to back the Trade Facilitation Agreement until it was assured proposed limits to farming subsidies would not affect its $12bn (£9.2bn) food-security programme.

It pays farmers over the odds for grain, some of which it sells to poorer households while the rest is set aside in case of shortages.

The WTO trade agreement simplified customs procedures and was designed to add $1tn to the global economy, and benefit developing countries in particular, so India’s defiance was strongly criticised by the global community.

India agreed to lift the veto after WTO members agreed that an arrangement known as a “peace clause” – which protects food stockpiling – would remain valid until the WTO could find a permanent solution.

It was due to expire in 2017, but will now effectively continue indefinitely.

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Cars for cheese – Japan v EU (2013-17)

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Sean Gallup

Negotiations on a big trade deal between Japan and the EU began in 2013.

Both sides wanted to slash tariffs on a huge range of goods, to boost trade.

This is a sensitive process because domestic producers tend to be wary of foreign competition.

The Japanese side was particularly keen to boost car sales in Europe, while the EU negotiators wanted to sell more dairy products.

Loosening the dairy rules wasn’t such a big deal for hard cheeses such as cheddar and gouda, which are not made in Japan.

But Japanese dairy farmers do make softer cheeses, which proved a roadblock in the final stages of the talks, earlier this year.

After some late night haggling, the EU’s Agriculture Commissioner, Phil Hogan, secured a compromise.

The EU would have a yearly quota of 31,000 tonnes for soft cheese exports, in exchange for almost complete market access for hard cheese.

A few days later in Brussels, EU leaders and Japanese Prime Minister Shinzo Abe announced the completion of the deal, dubbed “cars for cheese”.

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Wallonian dairy farmers – EU v Canada (2016)

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AFP

After years of negotiations, the EU completed its most ambitious free-trade deal to date: the Comprehensive Economic and Trade Agreement (Ceta) with Canada.

But under EU rules, some far-reaching trade agreements require the consent of all 28 EU countries before they can come into force.

To make things even more complicated, in Belgium seven federal, regional and community bodies had to give their approval as well.

Wallonia, the country’s French-speaking region, said no.

Politicians in the staunchly socialist region had concerns about the dispute-settlement mechanism in the agreement, along with something else – milk.

Wallonian dairy farmers worried about the impact of free trade on their sales.

A group of them marched outside the European Commission in Brussels to voice their disapproval of Ceta.

Eventually, Belgian political leaders reached a consensus and broke the deadlock, agreeing an addendum to the Canadian deal, which addressed concerns over the rights of farmers and governments.

The European Parliament approved Ceta in February, although it has not come into force yet.

The Slinky – that magic metal coil which climbs down stairs – has been a favourite Christmas stocking-filler for over 60 years. But it was never designed to be a toy. The BBC’s Aaron Heslehurst explains the twists and turns behind its creation.

Video producer: Jeremy Howell

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SWA

The Scottish government has called for Scotch to be defined in UK law in order to protect whisky exports after Brexit.

Scotland’s Economy Secretary Keith Brown has written to UK ministers calling for protection of the Scotch whisky industry.

The industry is worth about £4bn to Scotland in exports. An EU definition of whisky currently protects sales from sub-standard products.

The UK government said it would support the industry so it continued to thrive.

Mr Brown’s call follows International Trade Secretary Liam Fox’s visit to the US last week.

The economy secretary said: “Aside from being a key part of Scottish culture and identity, our whisky industry supports around 20,000 jobs.

“The US made clear in the Transatlantic Trade and Investment Partnership discussions that they would support a relaxation of the definition of whisky, which would open the market up to a number of products which do not currently meet that standard.”

‘Right outcomes’

He added: “It is vital that we continue to have robust legal protection of Scotch whisky, which is why I have sought clarification from the UK government as to whether Scotch whisky featured in discussions during last week’s trade visit by the Secretary of State for International Trade.

“I am also demanding that the current EU regulations are guaranteed post-Brexit.

“After reports this week that the UK government is contemplating trade deals that threaten the value and reputation of Scottish produce, once again we can see the confusion which is at the heart of the UK government’s Brexit position.

“We need to be sure that any future deals work for Scotland and are not threatening the livelihoods of our farmers and producers.”

He said all four UK governments should have oversight of the negotiations to ensure, as far as possible, “that the right outcomes for everyone are secured”.

A UK government spokeswoman said: “Scotch is a UK export success story and we will support the industry so that it continues to thrive and prosper post-Brexit.

“The UK government has a strong relationship with the Scotch Whisky Association and is working closely with the industry as we aim to secure the best possible deal for the whole of the UK.”