IGD - Economics bulletin 09 October

Date : 09 October 2020

Your overview of political and economic news with a focus on the food and consumer goods industry, featuring the latest guidance on COVID-19 and planning for the end of the transition period with the EU.

COVID-19 – Three tier model and support

With rising COVID-19 cases and hospital admissions, a new three-tier lockdown system is expected to be announced on Monday. This is expected to include a traffic light-styled system with the highest alert level 3 including the closure of pubs and restaurants, a ban on mixing households and restrictions on overnight stays.

The Chancellor has announced plans for further financial support to industries impacted by local restrictions.

Further restrictions in Scotland

The First Minister in Scotland has announced temporary measures to stop the spread of COVID-19 in Scotland. This will see pubs and restaurants in the central belt closing from 18:00 Friday 9 October and not reopening until at least 25 October. In the rest of the country no alcohol will be allowed to be served indoors and bar opening hours will be limited. There will be a £40m fund to support affected businesses.

The Scottish government is working out the details of how it will introduce regulations to extend the mandatory use of face coverings in indoor communal settings – such as staff canteens and corridors in workplaces. An announcement on the details of this is not expected imminently.

Workplace canteens

Defra is seeking a relaxation of current rules that require the contact details of work colleagues to be logged every time they enter a workplace canteen.

EU exit negotiations

The last of the planned sequence of trade talks between the UK and EU ended last week. Informal talks are continuing with a particular focus on key “red-line” issues - fisheries, governance, market regulation and state aid. IGD continues to urge members to prepare for “no-deal”.

Border Operating Model

The next iteration of the Border Operating Model has been published. This explains how goods will move over the UK border between GB and the EU from January 2021. Changes include clarity on border infrastructure, including processing areas away from the border and more information on the level of sanitary checks required.

Great Britain – Northern Ireland trade

There is still uncertainty about the requirements for moving goods from GB to Northern Ireland as the Withdrawal Agreement Joint Committee negotiations are yet to conclude. The government continues to seek to obtain lighter touch regulations to minimise friction at the border.

It is understood that a scheme that reduces checks on food and consumer goods moving from GB to Northern Ireland is likely to be progressed. The scope of this is expected to be limited to supermarket deliveries. Concerns have been raised that this may disadvantage other parts of the food retail and supply chain.

Northern Ireland trader support service

The Northern Ireland trader support service went live on 28 September. The service aims to help businesses and traders of all sizes to navigate the changes to the way goods move once the Northern Ireland Protocol comes into effect on 1 January 2021.

New UK GI logos

New Geographical Indicator (GI) scheme logos are now available to download. From 1 January 2021, producers will need to apply to the relevant:

  • UK scheme to protect a new product name in Great Britain (GB)
  • EU scheme to protect a new product name in Northern Ireland (NI) and the EU

EHC online

Export Health Certificate online is now open. From 1 January 2021 exports of Live Animals and Products of Animal Origin to the EU require an Export Health Certificate (EHC).

UK-Ukraine trade deal

The UK and Ukraine have signed a political, free trade and strategic partnership agreement. In 2019 the UK imported £177 million of cereals.

UK GDP

UK GDP grew by just 2.1% in August 2020. This was lower than expected. GDP remains 9.2% below the February 2020 level.

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