How will "Brexit" affect Chilean fruit?
As most of you know, the Proposed referendum on United Kingdom membership of the European Union it is a unique process about which no one is clear about what the real consequences will be. First of all, because they are just beginning to negotiate the terms in which this exit will take place and, secondly, because the very nature of this process (the new way in which the United Kingdom will relate to the rest of the world), makes it almost impossible to predict the changes to come.
Notwithstanding the foregoing and in regard to Chilean fruit exports, we can observe some facts that will allow us to draw certain conclusions.
In terms of volume, shipments of fresh fruit grew by 8,2% between January and April of this year, compared to the same period before the referendum that approved the Proposed referendum on United Kingdom membership of the European Union. And if we measure this same period in value and in pounds sterling, the fresh fruit has exported products for amounts that have reached 106,1 million, this is 17,5% more than 2016 when in the period the shipments reach the 90,3 million.
However, by doing the same analysis in dollars, we will see that these exports reached US $ 132,1 million in 2017, which compared to 2016, when they totaled US $ 129,3 million, is only 2,1%, which is due to depreciation of the pound, which has the immediate effect of making imports more expensive from the United Kingdom, which not only affects fruit, but also all commerce.
Today, among our main products shipped are fresh blueberries, which continue to show a very positive evolution in volume, with an increase of 11,3% up to April of 2017, reaching shipments by 9,6 million kilograms. In pounds, the increase has been even better, 23,3% more than in the January-April period 2016, totaling £ 44 million. This partly reflects the increase in the price level that has recently been seen in the country, which has given room to negotiate and sell higher volumes at higher average prices. Obviously, the situation in dollars is less positive, but in any case there is a significant increase of 7,2% reaching US $ 54,7 million in the same period.
On the other hand, it must be considered that due to the Proposed referendum on United Kingdom membership of the European Union and the consequent depreciation of the Pound, inflation has begun to show signs of increase in the United Kingdom, reaching levels close to 3% in recent quarters, after staying close to 0% for a long time. We see that it is important to monitor inflation, since it could have an impact on the consumption of fresh fruit.
Despite all these aspects, we still can not know exactly what consequences the Proposed referendum on United Kingdom membership of the European Union in our economy and in our shipments of fresh fruit. Following the notification by the United Kingdom to the EU of its departure, invoking Article 50 of the Treaty of Lisbon, a two-year process of negotiations was initiated to specify the conditions of this exodus. Until this exit is executed, the commercial relationship between Chile and the United Kingdom will continue under the terms contemplated in the commercial pillar of the Association Agreement of Chile with the European Union.
And in this context, Chile hopes to work together with the United Kingdom to establish a new mechanism that regulates trade between both countries and build on what has already been achieved within the framework of the European Union.
Source: Simfruit.cl
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