Farm Ireland

Friday 20 April 2018

Irish farming most exposed sector if British vote 'Leave'

Downing on politics

Willie Penrose. Pic Tom Burke
Willie Penrose. Pic Tom Burke
John Downing

John Downing

On Thursday week we will know if Britain is going to stay or leave the European Union.

And if Britain decides to go - Irish farming will be the first in the firing line.

It is hard to think of any other sector across the 28 member states which would be left more exposed. Discussions in the Dáil last week had an air of gloom.

Labour's redoubtable Willie Penrose was posing the questions and new Agriculture Minister, Michael Creed, did not dodge or try to downplay the implications for Ireland's agribusiness.

"There is no absolutely no upside for this economy from a Brexit," the Minister said twice during the exchanges.

The campaign has been bewildering for the middle-of-the-road British voter. Zealots on both sides conjured up apocalyptic images of the implications of staying or leaving.

The short answer to most conjectures is that we really do not know. The nearest to a precedent is the eventual departure of Greenland in 1985 after they had voted in a 1979 referendum to quit.

Greenland, with just over 56,000 people, it is comparable to County Monaghan or Waterford City. Britain has 64 million people and is the world's fifth largest economy. They are also hefty net contributors to the EU budget with a contribution of Stg£13m last year.

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CAP, which still accounts for 37pc of the EU budget, and could take a big hit if Britain leave. Some 50pc of Irish beef goes to Britain in trade worth €1.1bn per year. Britain buy 60pc of our pigmeat worth €3.3m per year.

Ireland also buys heftily from Britain, importing €3.8bn, against exports of €5.1bn. Of course people will argue, with some justification, that Ireland and Britain have always traded, long before any EU.

But the real rub here, and it is still not taken properly on board by many people engaged in this debate, is that if Britain leave, our trade arrangements with them will have to be fixed via Brussels and the other member states.

There is a dangerous assumption that Britain can just cherrypick the border-free single market - and junk the political stuff they find bothersome. They argue that Switzerland and Norway have managed to do just that.

But it may not be that simple. Anti-EU sentiment is not unique to Britain and it is clear that very serious reforms must be made.

An EU-wide study for the Pew Research Centre this week showed very high unfavourable sentiment across a range of larger member states. In Greece it was over 70pc and in France it was 61pc while it was in the high forties in many countries.

Against that backdrop there may be a rush of others trying to push the case to leave with Grexit, Frexit and other unlovely terms. Those trying to hold the line may decide there must be some consequences to Britain leaving.

Is there any cause for optimism? Well, British voters might opt to stay. And at all events post Brexit negotiations on details would be long and arduous. Many people believe the estimate of two years is wildly optimistic.

"Russia's accession to the WTO took 20 years. It will be a very high risk bet to hope that negotiations would be quickly completed and that negotiations would be uneventful," WTO boss, Roberto Azavedo said.

John Downing is an Irish Independent political correspondent

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