Brexit to severely diminish value of Scottish seafood industry

An economic impact report carried out for the Scottish Government points to “significant harm” to Scottish salmon farming and the wider seafood sector.

The paper, which will be published today, says a “hard Brexit” could cost £85 million in economic output and 430 full-time equivalent jobs.

As much as 43% of the job losses would be in the nation’s fishing sector, with another 44% in processing, devastating coastal communities.

The figures are based on comparison with levels recorded in 2015 as the sector enjoyed bumper results. Major expansion efforts are under way as companies seek to feed additional consumer demand in key markets including France, China and the USA.

But a study on potential impacts of four hypothetical Brexit scenarios suggests withdrawal from the bloc will put this in jeopardy.

Each of the four trade scenarios considered would leave Scotland worse-off than under the current framework.

Meanwhile, increasing tariff and other restrictions triggered by departure from the European single market and customs union would reduce any potential benefits from increased fishing quotas.

Farmed salmon exports would suffer a slide of 4-6%in export value as free trade with the EU ends.

According to a briefing seen by The National: “Under all of the scenarios Scotland’s aquaculture industry would be negatively impacted.”

The findings come despite heavy campaigning directed towards fishing communities by the Leave campaigns.

More than 171,700 tonnes of Atlantic salmon were produced in Scotland in 2015.

Figures released by HMRC in February record the highest ever value for Scottish salmon exports – £600m, a 35 per cent boost – and the volume sold abroad increased by more than one quarter on the previous year.

Commenting on the new report, Rural Economy Secretary Fergus Ewing said: “This report confirms that reduced access to EU markets could significantly harm Scotland’s seafood industries, with those parts of our sector reliant on the speedy supply of fresh product to European markets particularly at risk.

“The modelling of these four different scenarios highlights the complexities of Brexit for our seafood industry and in the absence of full EU membership, maintaining membership of the European Single Market and remaining in a customs union is the ‘least worst’ outcome for our fishing, aquaculture and processing sectors.

“The report also suggests that there is unlikely to be an immediate gain for the fishing industry with any quota increases for the fleet only likely to be achieved through international agreement following negotiation over time with coastal state partners, and those economic gains could be reduced through the impact of tariffs on trade.

“We will therefore continue to push to remain in the European single market and a customs union with the EU which is essential to protect and support the Scottish seafood sector, both at sea and onshore. We will also reiterate our calls for the UK Government to guarantee that it will not bargain away access to Scottish waters and resources to secure other UK interests.”

The work, carried out by ABPmer, Interanalysis and Vivid Economics, considers fishing quotas, tariffs and non-tariff measures like rules of origin and health certification requirements.

Loss of grant funding from the European Maritime and Fisheries Fund and access to workers from within the EU – which currently make up 60 per cent of the seafood processing labour force – is also “likely to result in significant negative impacts” on the performance of the seafood industries.

The Scottish Government says the EU exit agreement should “ensure a balanced settlement” that “recognises the legitimate aspirations of the Scottish fishing fleet but which also takes account of the interests of other seafood sectors, the needs of our rural and coastal communities more generally, the marine environment, and wider national interests such as on-going access to key markets and strong international relations”.