The Department of Finance has been to the forefront in assessing the impact of Brexit on our economy, commissioning and publishing a number of studies, both before and following the referendum. In addition, regular updates of my Department’s Macro-Economic forecasts take account of the impact of Brexit.
The UK is one of Ireland’s most important trading partners. In 2017 the Department of Finance published a paper on trade exposures which shows that relative to other EU Member States, Irish exports are substantially more exposed to the UK in a number of goods sectors.
The top five most exposed included the Irish agri-food sub-sectors Cereals, Vegetables and Fruit, and Live Animal products. In services, Ireland is in the upper range of the most exposed EU Member States, particularly in Financial Services.
The paper also finds that the share of exports going to the UK has increased in a number of sectors over the past 15 years, including the agri-food sector, contrary to the trend decline in the importance of the UK as export destination for overall Irish exports.
The most recent Contingency Action Plan was published in July set out in detail the Government’s analysis of the risks and impacts of a no deal outcome across 26 key areas. It underlines that Brexit will have profound and highly disruptive implications for Ireland, and sets out in detail the short-term risks associated with that.
Maintaining the closest possible trading relationship between the EU and the UK is therefore one of the Government’s key Brexit priorities. The Government will continue to work to improve the business environment – to make it more competitive, to assist exporters to diversify markets, and to provide better infrastructure.
Longer-term, we need to mitigate against the potential of regulatory divergence between the UK and EU standards given its potential implications for trade, investment and the competitiveness of our businesses. We will therefore be working to minimise this impact and to ensure a level playing field.
Since the referendum result in 2016, we have been taking steps to build up the resilience of the economy so that we have the capacity to deal with adverse economic shocks. This includes building up our fiscal buffers – by balancing our books and reducing our debt burden - and establishing the Rainy Day Fund.
The Government is continuing to work to prepare our economy for the challenges of Brexit, including through the Ireland Connected Trade and Investment Strategy, the Future Jobs Ireland Strategy and the 10-year National Development Plan. In addition, recent budgets have introduced specific initiatives, such as loan supports for agri-businesses, aimed at supporting those businesses most affected by Brexit. The Brexit Loan Scheme assists firms to adapt and innovate in response to Brexit, to restructure their cost bases and give them the opportunity to diversify into other markets thereby reducing their exposure to the UK. The Future Growth Loan Scheme provides a longer-term scheme facility of up to €300m to support strategic capital investment for a post-Brexit environment by business at competitive rates.
The Government has also stepped up engagement with stakeholders across all sectors through targeted events and media campaigns aimed at getting both business and citizens Brexit ready. Our planning at home and at the EU level for all possible outcomes has increased and will continue to intensify.
 Department of Finance (2017) Trade Exposures of Sectors of the Irish Economy in a European Context.