Irish businesses 'more alarmed' by Brexit than UK counterparts
Irish businesses are more alarmed by Brexit than even those in the United Kingdom, according to a new global survey by the US National Bureau for Economic Research.
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Irish firms spent more time discussing Brexit than their UK counterparts and the potential economic impact of the UK leaving the EU was regarded as far larger for firms in the Republic than for those in Britain.
A major survey of 7,333 firms from 71 countries, including 53 Irish companies, showed that both UK and non-UK firms overwhelmingly expected negative consequences from Brexit and that "no single country" had a significant positive reading.
Brexit exposure is strongly felt in countries as far apart as the United States and Singapore, for example, and there were widespread worries among international firms, the study said.
"For instance, Irish firms on average discuss Brexit significantly more than do UK firms," the research published by the National Bureau for Economic Research yesterday, a US body that is one of the top economic bodies in the world.
The report was based on transcripts from company earnings calls and showed large, negative effects of Brexit risk on investment and employment decisions as well as on stock returns.
"As an example, we estimate that due to Brexit risk, the average Irish firm decreased its investment rate by 3.9% and reduced its employment growth rate by 4.2% relative to the mean in every year since the Brexit referendum," it said.
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While the economy dodged a Brexit bullet after the UK and EU inked a Withdrawal Agreement, the whole process will play out again this year with London insisting it will leave with or without a trade deal at the end of this year.
The economic losses are higher in Ireland than in the UK in four out of seven studies, including the possible minimum and the maximum impacts, according to a study by the University of Leuven.