Dáil Éireann Debate, Thursday - 25 February 2021
63. Deputy Bernard J. Durkan asked the Minister for Finance if the economy has been able to withstand the impact of Brexit to date; if particular issues have arisen that might require attention; and if he will make a statement on the matter. [10879/21]
View answerThe new Trade and Cooperation Agreement between the EU and UK was a positive outcome of the Brexit negotiations. However, the new agreement still represents a break from previously existing arrangements, and thus a permanent shock to the Irish economy. Therefore, Brexit will still have a negative economic impact on the Irish economy and living standards compared to the previous relationship.
For Irish exporters, the Trade and Cooperation Agreement is positive, compared to a no-deal scenario, as it provides for zero-tariffs and zero-quota trade for qualifying EU and UK goods. However, it is important to note that the agreement does not completely mitigate against trade frictions in the form of non-tariff barriers, such as customs checks and procedures. So, while tariffs and quotas have been avoided for qualifying goods, non-tariff measures or non-tariff barriers represent a change in trading relations and an increased cost to trade. In addition, disturbances to retail and distribution supply chains could have a direct impact on Irish consumers through reduced competition and higher prices.
The Government has put in place extensive financial supports for sectors over recent years to assist businesses to prepare for and mitigate the impacts of Brexit, including various financial, advisory, and up-skilling supports. The Government has also invested heavily in port infrastructure, as well as working closely with businesses to navigate the new customs arrangements.
In the weeks since the end of the transition period on 31 December 2020, a level of trade friction has been evident. Given the phased basis of the new import controls which must be applied by the UK, it will take time for these to feed through to overall exporting activity, and to assess any associated economic impact.
