Business Irish

Tuesday 25 April 2017

Brexit fears rise among executives

Mayor of London Boris Johnson speaks to the media outside his home in Islington, London, where he said he is to campaign for Britain to leave the European Union in the forthcoming in/out referendum. Photo: Stefan Rousseau/PA.
Mayor of London Boris Johnson speaks to the media outside his home in Islington, London, where he said he is to campaign for Britain to leave the European Union in the forthcoming in/out referendum. Photo: Stefan Rousseau/PA.

Colm Kelpie and Gavin McLoughlin

Irish executives' fear of the impact of a Brexit on this country has grown as the referendum draws near, but fewer than last year believe a Brexit will happen, a new survey indicates.

Of 330 senior executives surveyed by headhunters Merc Partners, 87pc said Brexit would have a negative overall impact on the economy of the Republic of Ireland, a four-point increase on a year ago.

But just 25pc thought it likely that the UK will leave the EU in the next five years, down from 36pc last year.

Almost two-thirds of respondents said the biggest impact of Brexit on Irish business would be its effect on trade, with question marks over the relationship between a United Kingdom outside the EU and the single market.

"This research demonstrates that by far the most serious consequence of Brexit would be its impact on trade and trade barriers. Eight out of 10 respondents also want Irish political and business leaders to become actively involved in the campaign to keep the UK in the EU," said Ruth Curran, a partner at Merc.

"On the positive side, almost three-quarters of respondents felt Brexit would make Ireland more attractive for multinationals to invest," Ms Curran added.

Britons will go to the polls on Thursday, June 23, with an 'Out' vote likely to have ramifications far beyond Ireland.

Economists tasked by German think tank the Bertelsmann Foundation have produced a stark calculation of the resulting hit to per-capita incomes.

"We don't know what would come our way with a Brexit," said Gabriel Felbermayr, director of the Centre for International Economics at the Ifo Research Institute in Munich and one of the authors of the report. "But what is completely sure is that it would create enormous uncertainty, and there is very good empirical evidence to show how poisonous uncertainty is for trade flows and economic development."

Mr Felbermayr and his colleagues calculated that even under the best-case scenario, the UK and Ireland would suffer income reductions in excess of 5pc.

In the 'isolation' scenario - in which Britain would lose barrier-free access to continental trade - that damage soars to more than 20pc. (Additional reporting Bloomberg)

Irish Independent

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