Wine exporters remain in Brexit limbo

With only a month to go, the impact of Brexit on South African wine exports to the United Kingdom is anyone’s guess. This was the word from Maryna Calow, Wines of South Africa (Wosa) communications manager, to exporters in the Western Cape. “We can speculate as much as we want, deal or no deal, but we simply don’t know,” she said. The United Kingdom remains the top individual export destination for South African wines, accounting for around 33% of annual wine exports to the EU. Wine has enjoyed preferential market access in the European Union (EU) market since the conclusion
of the Trade, Development and Cooperation Agreement (TDCA) between the EU and South Africa in 2000. Since 2016 this access has been significantly enhanced under the Economic Partnership Agreement (EU-SADC EPA) signed between the EU and South Africa, together with Botswana, Lesotho, Namibia, Swaziland (BLNS) and Mozambique. According to Tralac, under the EU-SADC EPA, 110 million litres – 77 million litres bottled and 33 million litres bulk – of South African wine was permitted to enter the EU market duty-free in the first year of implementation. After the first year of implementation, the duty-free quota increases annually by  1 059 000 litres: 741 300 litres bottled and 317 700 litres bulk.
The quotas will be significantly affected following the UK’s breakaway from the EU. “We just don’t know what is going to happen,” said Calow when asked by members of the Exporters' Club Western Cape what the expectations were for wine exports following Brexit. “We know that an agreement has been signed and that a trade relationship will continue post-Brexit with the UK, whether there is a deal or no deal. But more than that we cannot speculate or say,” she said. South Africa and the UK (outside the EU) do not have a free trade agreement but the two countries have been in ongoing discussions finalising the roll-over of agreements post Brexit. The UK is not allowed to
draw up any agreements prior to its break from the EU which is why roll-over agreements have been put in place. By midFebruary the South African agreement with the UK was in its final stages but had not yet
been finalised. According to Tralac, South Africa will need to negotiate a new trade agreement with the UK after March 29 giving free or preferential market access to its wine.