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Brexit Issues

Dáil Éireann Debate, Tuesday - 27 March 2018

Tuesday, 27 March 2018

Ceisteanna (83)

Brendan Howlin

Ceist:

83. Deputy Brendan Howlin asked the Minister for Finance the economic impact assessments his Department has commissioned on Brexit. [5754/18]

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Freagraí scríofa

My Department has been to the fore in producing and funding a number of Brexit-related studies, both before and since the UK's referendum decision. In addition, regular updates of my Department’s macroeconomic forecasts take account of the impact of Brexit. Published and commissioned Brexit-related studies by my Department include:

- 'Scoping the Possible Economic Implications of Brexit on Ireland' – A scoping study of scenarios for the future relationship between the UK and the EU. Published under the Department of Finance-ESRI research programme in November 2015;

- 'An Exposure Analysis of Sectors of the Irish Economy’ – An in-depth analysis of the possible sectoral and regional impacts of Brexit arising from Ireland's trade relationship with the UK, published by Department of Finance in October 2016 (Updated March 2017);

- 'Modelling the Medium to Long Term Potential Macroeconomic Impact of Brexit on Ireland' – Published under the Department of Finance-ESRI research programme in November 2016; and

- ‘Trade Exposures of Sectors of the Irish Economy in a European Context’ – An analysis of trade exposure to the UK in comparison to other EU Member States, published by the Department of Finance in  September 2017.

The results in these studies show that the potential impact of Brexit on the Irish economy will be significant. Estimates from the macroeconomic modelling work with the ESRI project that, ten years after Brexit, in a WTO environment the level of Irish output could be as much as 3.8 per cent below a baseline of what it otherwise would have been. Projections by Copenhagen Economics, on behalf of the Department of Business Enterprise and Innovation, which my officials inputted into, suggest that the impacts could be higher if the EU and UK significantly diverge from one another in terms of regulatory standards.

Of course these projections are on a no policy change basis. However, with the future trade path between the UK and EU still unknown, it is crucially important that we prepare our economy for the challenges ahead.

In this context, the Government has already taken a number of important steps including in Budgets 2017 and 2018, the Action Plan for Jobs, Ireland Connected, our Trade and Investment Strategy, and the preparation of a new 10-year Capital Plan. The best way to deal with the uncertainties arising from Brexit is to continue the Government’s competitiveness oriented policies and prudent management of the public finances.

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