Ireland's Brexit position is facing growing pressure

Tuesday, July 30, 2019

The Irish government could be blamed at home for no-deal if concessions are not made on the backstop

Impacts

  • The absence of a contingency plan is making it harder for businesses to prepare for the impact of no-deal on trade along the Irish border.
  • A major study commissioned by the Irish government posits that a no-deal outcome will reduce GDP growth by 7% by 2030.
  • The EU could give Ireland a multi-billion-euro package to help mitigate the adverse impacts of no-deal Brexit.
  • A no-deal Brexit will probably result in the governing Fine Gael party being ousted from government.

Conclusion

Although the prospects of a no-deal Brexit are high, the Irish government has not yet published a concrete contingency plan on how trade will operate along its land border under a no-deal scenario. Dublin says that the Irish backstop -- the only issue blocking Brexit -- is not up for renegotiation. The new UK government says it will pursue no-deal until the backstop is removed.

If no-deal happens, Ireland faces the prospect of a hard border with Northern Ireland on November 1 and disruption to most of its trade, while the government could be blamed by many at home for causing no-deal. Alternatively, given such concerns, it could propose a time-limiting protocol to the backstop which may be accepted by the EU and United Kingdom.

References

See EU-UK: No-deal trading will be disruptive - July 16, 2019

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