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How will Brexit affect the alcohol market?

On the 23rd of June 2016 voters took part in a vote to decide whether the UK should leave or remain in the European Union. The results were announced and it was decided that Britain would leave the EU.  Due to the Brexit results, David Cameron the Prime Minister had resigned and Theresa May took over the responsibility to become the next prime minister of the UK.

As Britain is due to leave the EU, Theresa May is in negotiation with the EU council to get Britain a good deal.  Currently, the UK trades Wine and Spirits in six continents in 139 different countries. The challenge posed by Brexit will be to ensure that the UK maintains its ability to compete on the world stage and exploit the opportunities Brexit provides. 

With Britain exiting the UK and the pound weakening, this has, therefore, put a lot of pressure on the Alcohol Market. Britain is the largest wine importer in the world and the EU is the largest wine producing region. In 2015 around 60 percent of wine was supplied to the UK from France, Italy and Spain.  Wine imports have consequently become more expensive meaning that consumers are attracted to locally sourced wines.  With more consumers attracted to locally sourced wines, this will allow local wine companies to grow and expand allowing for new jobs.

The UK’s wine and spirits industry had made around $1.8 billion in EU exports in 2015. In addition to this, the UK craft brewers and spirits distillers are also seeing competition from competitors due to the pound weakening. Scottish Distilleries have been affected due to the Brexit decision. Currently, Scottish Distilleries make up the majority of UK spirit exports.

With negotiations over Brexit still taking place, the alcohol industry will have to wait and see what happens in terms of getting a good deal.

Join us at this year’s Spirits Strategies Congress event, where you will be able to see the various strategies for ways to increase brand growth within the spirits market. This event will also allow for like-minded peers to share ideas on how the industry will evolve in addition to introducing attendees to new strategies, concepts and ideas.

For more information, please email us at events@arena-international.com