Monday 22 January 2018

Prepare for the worst with Brexit, former WTO chief warns businesses

Pascal Lamy. Photo: Bloomberg
Pascal Lamy. Photo: Bloomberg
Colm Kelpie

Colm Kelpie

Businesses must be prepared for the extra costs that Brexit will bring, former World Trade Organisation chief Pascal Lamy has said.

Mr Lamy said he agrees with the push for businesses to prepare for the worst.

"If you're a business in the car industry, the airline industry, the food industry, you can do a simulation as to what would it mean if the UK exits in May 2019 on WTO terms," Mr Lamy told the Irish Independent, on the margins of a Brexit event organised by AIB.

"But for sure … it will have a cost so we have to prepare for this cost. Your bottom line will be affected anyhow, and then you need to take your options on where you want to invest in five or ten or 15 years to come."

Enterprise Ireland chief executive Julie Sinnamon has said firms have been in denial, and warned that they must start planning for a hard Brexit.

Mr Lamy also told this newspaper that there there will be some form of border post-Brexit.

"There will be a friction. You cannot have your cake and eat it," he said. "We have removed borders to reduce costs. That's why we did it. There will be a cost. And then the question is for whom? The consumer will have to pay the cost," he added.

Mr Lamy said Britain will be on a "slow, painful, bumpy road to recognising reality, which is that Brexit is not a good thing", adding: "I never thought it was a good thing. I think it was a mistake."

"It's not a question of negotiating the best deal. It's a question of negotiating the least damaging deal. And once you look at it this way, I think it becomes easier."

In his address to the AIB event at the Royal Hospital in Kilmainham last week, Mr Lamy said it was impossible to have a 'no border' solution, claiming it was a "fairy-tale".

"Borders are necessary to check and to police. I personally believe that there is no 'no border' solution," Mr Lamy said.

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