EUROPEAN-SEED.COM I EUROPEAN SEED I 5 I n March 2017, IHS Markit conducted a survey to see how Brits feel now that some time has passed and the dust has somewhat settled since the Brexit vote. The survey revealed that only 29 per cent of British house- holds believe that Brexit will be good for the United Kingdom’s (UK) economy over the next 10 years. This is a remarkable decrease from July 2016, when 39 per cent of the British public believed that leaving the European Union (EU) would make Britain's economy better off. For farmers in Britain, Brexit would signal the end of European subsidies – monies have been around for decades – that have been paid for by the EU’s Common Agricultural Policy (CAP). Some 55 per cent - €3 billion ($3.17 billion) – of farmers’ total revenue was provided by CAP. Critics of CAP frequently focus on subsidies — which, in the UK’s case provides more than half of farming income — as wasteful and distorting. The UK government has promised to keep subsidies going until 2020, but the situation after that is unknown. Subsidies could still be used to maintain farmers’ incomes and for environmental stewardship, but for many producers they would not be able to compensate for the loss of competitiveness. What happens after 2020 in terms of subsidies is uncer- tain. And for those in the agri-sector in the UK, some questions remain that will be answered in the coming years: • Will the UK scale back/abolish the agricultural subsidies altogether? • Will the UK be able to enter into trade agreements – strictly with Commonwealth countries, for example – that they would have otherwise not entered into as a member of the EU? • Could the UK keep the current amount of agricultural subsidies, with fine-tuning that outlines environmental, R&D or employment initiatives that drives funding in cer- tain directions? Like most things in life, it all comes down to numbers. The trade with the EU is very important to the British econ- omy with around 45 per cent of the British exports -- worth £230 billion (€265 billion) -- ending up in other EU member states. And in return, roughly 53 per cent of imports to the UK -- worth £289 billion (€333 billion) -- come from the EU bloc. No surprise that this amount of trade creates and supports a huge number of jobs. According to data by the European Institute, around 3.4 million British jobs depend upon exports to the EU. And there’s more. In terms of investments, the EU is a major source of foreign direct investment in Britain. In 2014, all the other EU countries invested £496 billion (€573 billion) in Britain, which amounts to almost half of all outside investments in the country, according to research by the UK parliament. And then there is the payment that Britain will need to make to the EU. In a recent interview with the BBC, EU Commission President Jean-Claude Juncker mentioned that Britain would need to pay roughly £50 billion (€58 billion) as it leaves the EU. All of the EU member states pay into the communal budget, which is then used to finance everything from infrastructure projects, social programs, scientific research and pensions for EU bureaucrats. The crux of this payment request is that the bloc's budget is negotiated to cover a period of years, with the current agreement extending to 2020. The UK will become the first member country to leave the EU. In order for the country to survive, it will be crucial to strike a series of individual trade deals, and the fate of British farming will be one of the most uncertain outcomes. While many are pinning their hopes on the fact that a future outside of the EU may open up new export opportunities, redis- tribution of monies or adjusted regulations, the future, in this case, is not clear. And as any farmer will tell you one thing you cannot count on is the weather. Apparently, the other is the complex issue of one country, leaving a union, an uncertain economy, and change coming in spades in every sector from policy to patents. Who knew? IS IT A CASE OF REGREXIT? BY MARCEL BRUINS AND MICHELLE CLARKE