Dáil Éireann Debate, Wednesday - 21 April 2021
165. Deputy Neale Richmond asked the Tánaiste and Minister for Enterprise, Trade and Employment if he will provide an updated report on the implementation of the EU-UK trade agreement, and the impact that it has had on Ireland and our trading patterns; and if he will make a statement on the matter. [18647/21]
View answerThe EU-UK Trade and Cooperation Agreement has mitigated the potential for significant damage to Irish businesses which would have arisen from a ‘no-deal’ outcome.
However, Brexit has fundamentally changed the trading relationship between Ireland and the UK and will continue to impact that trading relationship. Since the Agreement came into force, we have seen some short-term disruption arising from the new requirements around customs and SPS checks and controls. Businesses are however gradually adjusting to the new trading realities, finding alternative supply chains and are being encouraged to find new markets for their products.
In a recent survey of 400 companies, who participated in an Enterprise Ireland webinar on Rules of Origin, the main challenges they identified as of 1st of January related to rules of origin; customs procedures and delays at ports; VAT complexities and, supply chain issues. Enterprise Ireland continues to actively engage with client companies to fully understand their business needs and to further develop information and events to respond to those needs.
The deputy will be aware that economic analysis carried out in 2018, updated in January 2020, on the economic impacts of Brexit on the Irish economy, identified the Agri-Food sector as the one most likely to be most seriously impacted. In that respect, the €100 million Capital Investment Scheme for the Processing and Marketing of Agricultural Products, managed by Enterprise Ireland, is just one of the ways the Government is helping the Agri-Food sector manage the fallout from Brexit.
In the most recent CSO statistical data release, this indicates that Ireland’s total goods exports rose almost €800 million (+7%) in February 2021 when compared with February 2020.
Goods exported to GB showed a decrease of 11% to €859 million in February 2021 compared with February 2020. Exports to Great Britain accounted for 7% of total exports. The value of goods exports to Great Britain in the first two months of 2021 was €1,812 million, a decrease of 12% on the first two months of 2020.
Imports from Great Britain decreased by 53% to €650 million compared with February 2020. Imports from Great Britain were 10% of the value of total imports in February 2021. The value of goods imports from Great Britain for January and February 2021 was €1,206 million, a decrease of 57% compared with January and February 2020.
It is too early, based on statistics for the first two months of 2021, to get a real sense of the impact that Brexit will have on longer term trade flows as there are other contributory factors, not least COVID-19 that has also had a chilling economic effect. Analysis of trade flows over a longer period of time would be required to allow for sound conclusions to be drawn.
Notwithstanding the new business challenges, the UK continues to be a strategic market of importance for Irish companies. While Enterprise Ireland clients are continuing to diversify their export markets, the UK market remains the largest export market for Enterprise Ireland clients. In 2019, Enterprise Ireland clients reported €7.9 billion in exports to the UK, representing 31 per cent of total client exports.
Enterprise Ireland remains committed to working with client companies to assist them sustain and grow their business, both in the UK, and through market diversification. This will be delivered through a comprehensive programme of funding, advice and in-market supports to get customs ready, remain competitive in the UK and identify future growth opportunities.
The Government is committed to ensuring that the most Brexit impacted sectors of the economy will be supported and assisted. The EU Brexit Adjustment Reserve and the proposed significant allocation of funding to Ireland under this fund is strong recognition of the fact that Ireland is one of the most impacted Member States by Brexit. The fund will be used to mitigate the worst impacts of Brexit for the most impacted sectors in the economy.
