Food Drink Ireland, the Ibec group which represents the food and drink sector, has called for exceptional targeted policy responses to offset the impacts of Brexit in next week's Budget.

In its Budget 2021 submission, Food Drink Ireland said that Brexit involves an "unprecedented fracture" of the Single Market, with Ireland particularly exposed. 

It said the food and drink industry remains very reliant on the UK market and is the sector most exposed to Brexit. 

Food and Drink Ireland noted that while the UK as a percentage of the country's overall exports has dropped in recent years and now stands at 34%, in absolute value terms it continues to increase and now stands at €4.5 billion. This marks an increase of 32% since 2010. 

"This demonstrates the importance of maintaining our market position in this high value, high quality market that has a substantial food deficit and not relinquishing the market to global competitors," the group said. 

Food and Drink Ireland said proposed measures to help the industry include accessing the existing €4 billion in Brexit contingency funding set aside for the years 2020 to 2025.

The group also calls for an extension beyond December 2020 of the Temporary Framework for State aid supports as well as substantial funding from the EU's €5 billion Brexit Adjustment Reserve and any increased tariff revenue from UK imports in order to maintain and sustain economic activity and jobs.

"Funds amounting to 5% of the value of current annual export sales to the UK will be needed annually from domestic and EU sources for at least three years," Paul Kelly, Food Drink Ireland's director said.

Food Drink Ireland said that in the event of no deal, Irish agri-food and drink will see tariffs of up to €1.5 billion imposed on exports to the UK and imported food and drink from the UK will face tariffs which will be collected by the Irish Exchequer and the EU. 

It said that some or all of this should be used to offset the tariff impact on Irish exporters and indigenous manufacturers who import critical raw materials.