What will Brexit mean for the flower sector?

What will the consequences of a Brexit be for the flower sector? Today, the United Kingdom will hold a referendum on continued membership of the European Union. British wholesalers see opportunities of a depart, but many breeders are uncertain about the stability of the international plants and flower trade.



Advantages wholesalers
According to Michael Dodd of Sunflora, a British importer of flowers, a possible Brexit will not have direct consequences for their company, unless the value of the pound will dive. "We import many flowers from South America, so if the pound drops against the US dollar, we have a problem", says Dodd.

He believes British wholesalers could profit of a Brexit. "Currently, the florists pay 20% VAT on their flowers bought from wholesalers and just 6% over the flowers they import from the Netherlands. When the UK leaves the European Union, the VAT over the Dutch ornamental prodicts will possibly increase and therefore will be less attractive for the florists. They can buy the same, and even more fresh, flowers from the British wholesalers for a similar price."

Dodd is still not sure what to vote. "Fortunately, I have still a couple of hours to make up my mind."

Disadvantages
A British importer who made his choice already is Adam Porges of All Season Flowers. "I do not see any advantages if the UK will leave the EU, so I voted Remain." But if the UK will leave the EU, not much will change for All Season Flowers, according to Porges, unless the pound drops. "We import from South America so the decrease in value of the pound is our biggest fear. Then, our flowers will become more expensive for the British people", he says.

Nevertheless, he stays optimistic. "The pound also dropped in 1993 and 2008 and in both situations, we got back on our feet. People will keep buying flowers, even when they are a bit more expensive. Even if there will be a Brexit, if the dollar will take a dive, we expect and fully believe that it will come back on its original level again." But all in all, Porges hopes that the UK will remain in the EU. "Then we keep the current stability. And over the last weeks, the pound even increased in value. It would be a pitty if it will drop."

Dutch exporters
The Dutch exporters are hesitant to give a reaction - they do not want to offend their clients. "Anyway, we expect the trade to continue and we will keep on exporting to the UK - we just hope in good conditions." But also for the Dutch, the currency exchange rates are a big concern. How will the pound react against the euro? How much is not clear, but they expect the value of the pound to decrease. Depending on the behavior of the dollar the, in particular, large Dutch exporters and trade companies will feel the consequences.

Another trader is quite sure about the outcome of the referendum. "I think they will remain in the EU and nothing will change", says a Duch trader. "However, the British people will increase their requierments in the immigration policy for example, but for the trade, I do not think we will see any shocking changes." This Dutch trader sees a clear division in the UK. "In general, in my opinion, more eldery will vote remain. They known the time before the EU and at that time life went on too. For the younger generation, this is less the cause."

Negative effects for Breeders
The costs and the administration difficulties are a subject of concern at plant breeder's agent Plants for Europe. They recommend their customers to vote for stay.

"We feel it is important to outline what we foresee as the likely implications of Brexit for plant breeders, both British and from other countries and for growers, retailers, landscapers and gardeners", they write on their website. Even though the output might be uncertain, the organisation feels the consequences for the Plant Variety Rights should not be forgotten. Right now, the European Union Plant Variety Rights are used in the UK, even though there is a UK system as well.

If the United Kingdom were to leave the European Union, EU PVRs would no longer be enforceable in the United Kingdom and according to Plants of Europe this would turn out negative. "There are many good reasons to vote Remain on June 23rd – the wider economy, social cohesion, freedom of movement of goods and people. There are also good horticultural reasons – a robust and effective plant health system, access to suppliers and markets on the Continent," they say. "But for plant breeders and innovators, we think that the argument is simple. Brexit can only make business more difficult and more expensive."


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