Sinead Ryan: Five ways Ireland will be poorer following the British decision to exit the EU
FROM trade to travel, here are five ways we'll be poorer from today following the historic British decision to exit the EU:
Britain is our biggest trading partner in Europe (and we theirs), by a long mile. It’s worth €1.2bn a week, or over €60bn a year. Brexit won’t do away with that, but any agreements under EU tenders or rules, for example, will have to be re-examined. New trade negotiations may have to take place with UK companies wanting to conduct business in Ireland. This all takes time, and while the UK very much wants to do business with us, it will now be less smooth. The ESRI has warned trade will slump by up to 20pc while Michael Noonan has said it could cost us €3bn between now and 2018 … the same €3bn he had earmarked for our ‘rainy day’ fund.
The UK and Ireland have enjoyed a common travel agreement since the 1920s, strengthened by EU membership. Brexit may mean that some sanctions are re-imposed, especially since migration was the recurring issue for Leave voters. They don’t mean us specifically, but it’s harder to introduce one law for some travellers and another for different ones. The 2011 Short Stay Visa Waiver programme allowed visitors to the UK to travel here, and vice versa, so we benefited from crossover tourism to the ‘British Isles’. This is sure to be re-examined. Brits account for 42pc of all tourism to Ireland, and we will be suddenly less attractive as a destination due to a drop in Sterling.
Sterling will take a hit immediately. Although traditionally a strong currency, it will probably rebound in time, but until then Irish exporters will feel the pain as it will be harder to sell products into the UK. Likewise importers of British products will need to impose higher prices to cover the costs of any renewed trade barriers. We’ll all feel that in our pockets.
€108bn is invested in pension funds here, much of it in equities and UK pension companies which operate here. With uncertainty surrounding stock markets pension funds will take a hit, which will particularly be felt by those who are due to retire over the next few years.
Brexit voters are sick and tired of bailing out other people’s problems. Some voters may include Scotland and Northern Ireland in this. There will certainly be increased pressure on the former to have another referendum on leaving the UK and with an annual spend of €7bn of British taxpayers money propping up Northern Ireland, others may call for this to be cut. That, along with border issues, might increase job losses there and put a strain on cross border trade and activity.