A global trade war is almost more threatening for the Republic than Brexit given that it would have no control over hostilities, it has been argued.
Fears of a trade war between the United States and China - the world's two largest economies - returned to haunt markets yesterday as China retaliated against Washington's plans to slap tariffs on Chinese goods, sending US stock futures tumbling and sinking European and Asian equities.
Kieran McQuinn, research professor with the Economic and Social Research Institute (ESRI), stressed Brexit was a big concern and at present likely remained the greatest external threat to the Irish economy.
But he said the Irish Government has some input into how the UK's EU exit pans out via the negotiations. That won't be the case if one of the worst trade disputes in many years turns into a full-scale trade war between the world's two economic superpowers, he said.
Given the open nature of Ireland's economy, any fall in global GDP as a result of a trade war would have a like-for-like impact on Ireland, the ESRI believes.
"To a certain extent, we have some control as far as Brexit is concerned through the EU and the way in which we seek to influence negotiations, but obviously a global trade war between China and the United States is very much outside of our control," Mr McQuinn said.
"We don't have any real input into that. In that sense, it's almost even more threatening for us. Brexit is still a very important consideration."
If world GDP were to fall by 1% as a result of a trade war, so to would Ireland's, the ESRI forecasts. "Because we're so open, any impact on global GDP, and any trade war obviously would have a negative impact on global GDP, the Irish economy would be hit on an almost one-for-one relationship," Mr McQuinn said.
"The general overall impact on global GDP is the first round impact, and then more specific impacts of more specific tariffs would have an additional impact. If it was a particular agricultural commodity that was hit by a tariff - even one not directly applicable but applicable to some third country - then it could even be more than one-for-one."
China hit back quickly yesterday against the Trump administration's plans to slap tariffs on $50bn (£35.5bn) in Chinese goods, retaliating with a list of similar duties on key US imports including soybeans, planes, cars, beef and chemicals.
The speed with which the trade struggle between Washington and Beijing is ratcheting up led to a sharp sell-off in global stock markets and commodities.