Belfast Telegraph

UK Website Of The Year

Brexit 'would cost Ireland billions'

Published 05/11/2015

A British exit from the EU could lead to Ireland losing out on billions of euro
A British exit from the EU could lead to Ireland losing out on billions of euro

A British withdrawal from the European Union would cost Ireland billions of euro every year in lost trade and hiked energy costs, a new study has found.

Analysis by a leading think-tank in the Republic also suggests business in Northern Ireland and along the border would be worst hit by a so-called Brexit.

The Economic and Social Research Institute (ESRI), which informs policy-making in Dublin, looked at the potential economic consequences for trade, foreign direct investment, energy and migration.

"The bottom line is the Irish interest is not served by the UK leaving the EU," said Dr Edgar Morgenroth, associate research professor at the ESRI.

The report author said a post-Brexit drop in Irish exports to the UK could cost as much as 3 billion euro (£2.12 billion) every year to the economy.

Home-grown firms would take the brunt as they rely more heavily on trading over the Irish Sea, compared to the multinationals.

Firms along the border would also be badly affected as they rely on sales to Northern Ireland.

But Dr Morgenroth also pointed out that businesses in Northern Ireland would be harder hit by a demise in North/South trade, as they gain more from the relationship overall.

"Given that there seems to be a bigger reliance on the Irish market for Northern Ireland businesses, any trade impediment would obviously hurt Northern Ireland more," he said.

It is estimated both the Republic and Northern Ireland would suffer a 20% drop in trade.

The study also looked at the impact of a Brexit on the energy market.

It found that the Republic could be forced to look at building a new electricity interconnector with mainland Europe, most likely France, if current access through the UK was blocked.

The cost could be upwards of 10 billion euro (£7 billion) .

The report also scotched suggestions the Republic could significantly benefit from more foreign investment by global firms by-passing the UK in favour of Ireland, as it remains in the EU.

"Our analysis suggests this would not be significant," said Dr Morgenroth.

"Bigger countries like France and Germany would probably benefit more from a redirection of foreign direct investment away from the UK."

Your Comments

COMMENT RULES: Comments that are judged to be defamatory, abusive or in bad taste are not acceptable and contributors who consistently fall below certain criteria will be permanently blacklisted. The moderator will not enter into debate with individual contributors and the moderator’s decision is final. It is Belfast Telegraph policy to close comments on court cases, tribunals and active legal investigations. We may also close comments on articles which are being targeted for abuse. Problems with commenting? customercare@belfasttelegraph.co.uk

Read More

From Belfast Telegraph