As of 31 December, 2020, the transition period of the UK’s exit from the EU has ended, and Europe is now left to deal with its economic fallout. General consensus seems to be that the move will ultimately prove harmful to the UK and the EU, including Ireland. In fact, Ireland will likely be more affected, as it is more exposed to its effects than others due to the intensity of trade between the two. Costs associated with that trade will undoubtedly increase, as the UK is Ireland’s second-largest training partner, accounting for 14% of Irish exports and 26% of imports, second only to the U.S. Brexit will necessitate additional steps in conducting said trade. Trade between the two is already said to have fallen substantially. To get around this, some businesses have been going through Northern Ireland.
Trade with the rest of Europe will also be made more complicated post-Brexit. Shipments from Ireland to the mainland have often gone through the UK historically. Now, Irish businesses have had to find and arrange for new routes. At present, these new routes are said to add up to an additional 24 hours to the shipment process. Furthermore, with routes the way they are now, trucking shipments is also taking substantially longer, as some ships might dock in a port substantially further away from their final destination than they would otherwise. Additionally, more direct routes have still proven more expensive than those used before Brexit.
Certain industries will likely be hit harder than others; some of the most vulnerable are agri-food, retail, and air transport. The first of these is expected to be hurt the most, given that roughly 40% of agri-food exports are to Ireland.
Still, this impact is perhaps not as severe as it could have been, had no deal been reached between UK and EU negotiators. Predictions for a no-deal Brexit included a 7% reduction in growth for the Irish economy and 100,000 fewer jobs. Further, tariffs on imports/exports would have hurt trade even more than the deal already does. It is thought that small- and mid-sized exporters would have seen the worst fallout from a no-deal Brexit.
Irish businesses and policymakers need to continue to consider the ongoing effects that Brexit will have on the Irish economy and the way trade is conducted with the UK and the European mainland. The speedy creation of better, more efficient trade routes is essential, and some of the most impacted industries, like agri-food, might demand extra attention to mitigate some of their losses.
