Biting off billions in business

WE are not just good at eating and drinking. We prepare food and beverages for ourselves and most especially for others in a big way. The Irish food and drinks industry is a £10 billion business.

It's the Republic's single most important manufacturing and service sector. Food and drink accounts for 6 per cent of gross domestic product and 18 per cent of total exports, employing about 45,000 people.

The food service market, including supermarket business, is worth up to £700 million, according to analysis by An Bord Bia and IBEC. Those dealing in, preparing and selling foods and drink amount to a further 58,000 people.

Through the purchase of raw materials and services, food and drink companies put about £7 billion back into the Irish economy - more than any other sector. For every £1 in output, 85p is captured by the local economy because of reliance on native raw materials. The average local spend in general manufacturing is 55p. In some sectors, such as computers, it can be as low as 30p.

Some £640 million is being invested in a five year EU supported programme for the food sector up to 1999. The Department of Agriculture and Food predicts that annual exports within that period will increase from £4.5 billion to £7 billion.

These impressive statistics hide the vulnerability of the sector. The products are perishable and have a short shelf life. Food scares often demand total withdrawal of a product and have the ability to wipe out a brand, if not a manufacturer, overnight.

That has a knock on effect on everyone in the business. Nowhere is that more evident than the BSE crisis. A problem not of our making was primarily responsible for slashing £300 million off Irish food exports last year compared to 1995. A few sentences delivered in the British Houses of Parliament, linking BSE to the human condition of CJD, dramatically reduced meat consumption across Europe in an instant. It is unlikely to fully recover.

Fortunately, it has coincided with the Republic embracing food safety, quality, research and diversification. Ultimately, BSE may be just a blip as far as our food production is concerned.