Monday 10 December 2018

New report outlines four scenarios for Ireland after Brexit - but all show economy will take a hit

  • Report shows Irish economy will grow by 7pc less in worst case scenario after Brexit
  • Government is "satisfied" it is doing all it can
  • Independent report will act as a "guide" going forward
  • Farmers warn outcome for food and agriculture is "catastrophic"
September 25, 2017: Taoiseach Leo Varadkar and British Prime Minister Theresa May in Downing Street discussing Brexit developments, including the future of the Irish border, the Common Travel Area and provisions to ensure the Northern Ireland peace process is protected. Photo: Facundo Arrizabalaga
September 25, 2017: Taoiseach Leo Varadkar and British Prime Minister Theresa May in Downing Street discussing Brexit developments, including the future of the Irish border, the Common Travel Area and provisions to ensure the Northern Ireland peace process is protected. Photo: Facundo Arrizabalaga

Michelle Devane

The Irish economy will be hit by Brexit whatever the outcome of negotiations between the UK and the European Union, the Government has been warned.

It has said that it will act on the advice outlined in the economic report to help prevent the worst from happening post Brexit.

Business Minister Heather Humphreys raised the findings of the Government-commissioned report at Cabinet on Tuesday.

The independent study by Copenhagen Economics calculated the impact of Brexit on Ireland's trade and economy.

It identified four scenarios, and in the worst outcome the Irish economy would grow by 7pc less than it would have without the UK withdrawing from the EU.

In the best scenario the Irish economy would grow by 2.8pc less.

The report was commissioned by the Government.

Irish Farmers' Association president Joe Healy said the findings of the report were stark for farming and food in Ireland.

"We are not surprised to see that our sector faces such a catastrophic outcome in the event of a hard Brexit," he said.

"The severe impact across the board is something IFA has raised at all political levels since before the referendum."

Mr Healy said the warning should serve to refocus Government efforts towards securing an outcome that avoids the bleak scenario for the country's largest indigenous sector.

"If the UK wants continued access to the EU market, the EU must insist that the UK will not be free to open their markets to low standard or low value products from outside the EU," he said.

A spokesman for the Taoiseach said: "The Government will act on its advice. It will inform the Government in terms of future decisions."

He added: "The Government is satisfied that it is doing all that it can and more to deal with the Brexit situation."

Ms Humphreys said the report was there to guide the Government and help prevent the worst from happening.

The report found five sectors will account for 90pc of the impact. They are agri-food, pharma-chemicals, electrical machinery, wholesale and retail, and air transport.

Ms Humphreys said the Government was acutely aware that certain sectors are particularly exposed to Brexit.

"That is why, among other supports, we will be rolling out a new €300m Brexit Loan Scheme in late March, which will be open to all sectors, with at least 40pc of low interest loans being made available to the agri-food sector," she said.

"We are also developing a Longer-Term Loan Scheme, and announced a €25m Brexit Response Loan Scheme for the agri-food sector in Budget 2018."

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