Thursday 18 January 2018

IBEC boss warns Ireland could also face an EU exit if Europe insists on a 'one size fits all' approach

Ibec CEO Danny McCoy. Photo: Colin O’Riordan
Ibec CEO Danny McCoy. Photo: Colin O’Riordan
Colm Kelpie

Colm Kelpie

The cost of Ireland remaining in the EU post Brexit could be very heavy if Europe insists on a “one size fits all” approach to the bloc’s future, the head of the country’s biggest business body has warned.

IBEC boss Danny McCoy warned Ireland could be ultimately hurtling towards an Irish EU exit unless it gets flexibility on issues like the fiscal rules, a common consolidated corporate tax base and state aid.

Ibec has been calling for Europe to ease fiscal rules to allow Ireland to spend more on capital infrastructure. Its food and drink wing has also called for a series of exemptions from EU state aid rules for the Irish agri-food and drink sector.

“We want to stay in the EU 27, but the costs of us staying in the EU 27 could be very heavy if the EU 26 don’t allow us the capacity to stay in and compete,” Mr McCoy told on the margins of a Brexit conference organised by the Institute of International and European Affairs (IIEA) and law firm McCann FitzGerald.

He warned of the potential for the EU to insist on a “one size fits all” approach to fiscal rules, to a common consolidated corporate tax base and state aid rules.

He earlier suggested to the IIEA/McCann FitzGerald conference that the EU immigration issues felt in Britain and which helped fuel the Brexit referendum could be replicated here unless the Government is able to spend more to deal with the state’s infrastructural deficit.

Mr McCoy said Britain and Ireland have disproportionately experienced EU migration, which, he noted, had been great for business.

But he added:  “If the infrastructure isn’t building fast enough, people will feel crowded out in the playground, or from the school, and that’s what led to the [UK] referendum.

“If the fiscal rules are the things that stops you from taking the resources you have and building that infrastructure fast enough, we’re hurtling down for exactly the same kind of referendum decision here if we don’t wake up. If we don’t appeal to that force majeure issue and get this one size does not fit all, then I think we’re in a conflict with the other EU 26.”

John McGrane, the head of the British Irish Chamber of Commerce, said we need to now have a conversation about the future direction of the European Union.

“We need to have a conversation about where is the European Union taking us,” he said. “We have to feel completely secure in our ability to have a conversation that appreciates absolutely what EU membership has given us, and yet be able to say ... is the EU as strong as it needs to be, and delivers in this context a competitive platform for businesses to prosper globally, but also to take care of Ireland’s utter connectivity to the UK.”

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