Thursday 19 September 2019

Taoiseach sounds stark warning to businesses over Brexit

Concern: Retail Ireland boss Thomas Burke warned of tariffs
Concern: Retail Ireland boss Thomas Burke warned of tariffs

Cormac McQuinn and Shawn Pogatchnik

Taoiseach Leo Varadkar has issued a stark warning to businesses to make preparations for Brexit, saying it can't be assumed that "it'll be all right on the night".

It comes as retailers last night warned that a hard Brexit would be certain to drive up costs and red tape for Irish businesses with online customers in the UK.

And Fianna Fáil renewed criticism of the Government's communication strategy to help businesses prepare.

Mr Varadkar made a direct appeal to small and medium enterprises (SMEs) to step up their contingency planning as he attended a conference on the Government's Future Jobs initiative alongside Business Minister Heather Humphreys.

He encouraged businesses that trade with the UK to be prepared for the "real possibility of a no-deal Brexit on October 31". He said he remained optimistic about avoiding such a scenario but felt previous extensions to the Brexit deadline might "lull people into a false sense of security that there'll definitely be a deal, that it'll be alright on the night or, worst case scenario, there'll be another extension.

"I don't think we can make that assumption, certainly not on this occasion."

He said he was appealing to businesses again "if you haven't engaged in Brexit planning, you really need to do so. It's not that far away".

Last night, Fianna Fáil TD Lisa Chambers said the latest figures from Revenue showed 70pc of firms that trade with the UK still didn't have registration numbers to allow them to continue this business post-Brexit.

She said 65,000 businesses still didn't have Economic Operators Registration and Identification numbers and urged them to apply for them.

She also hit out at the Government, claiming its "communication strategy to date has left a lot to be desired".

Mr Varadkar last night held his first phone conversation with incoming European Commission President Ursula von der Leyen. He thanked her for her "strong message of support on Brexit".

In an earlier interview with Newstalk, Mr Varadkar said Ireland was in talks with the Commission on how to protect the EU single market while seeking to avoid a hard Border with the North.

He said Ireland would have to defend the single market as it protected "our livelihoods and our prosperity". He said Ireland must not become a "back door" for goods entering the EU from the UK.

He was challenged on how this would be policed without checks on the Border.

Mr Varadkar said: "They're the kind of things that we're trying to work out with the European Commission ... and we don't have a perfect solution."

One proposal is that the entire island of Ireland would be treated the same when it comes to agriculture and food, and checks would be carried out on goods coming in from Britain at ports. He conceded that it didn't solve the problem of tariffs and that the DUP would oppose such an idea.

Separately, Retail Ireland director Thomas Burke raised concern over the prospect of Ireland being required to trade with the UK on World Trade Organisation rules in the event of a no-deal Brexit.

He warned that online sales from one country to the other would immediately face tariffs on most goods, increasing the price tag by 10pc to 50pc.

He said it would also be harder for Irish retailers to sell to UK customers because the pound would almost certainly depreciate further, making Irish goods priced in euro more expensive.

"Without some sort of free trade agreement with the UK, Brexit will mean currency competitiveness problems and tariff barriers," he said. "It will not be good news for online retailing in either direction."

Irish Independent

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