Expected Brexit deal is good news for Irish food sector

Deal will remove immediate threat to the beef, dairy, and other food sectors which employ hundreds of thousands here

European Union's chief Brexit negotiator Michel Barnier. Picture: John Thys, Pool via AP

Britain and the EU are closing in on a Brexit deal that would remove the immediate threat to the beef, dairy, and other food sectors which employ hundreds of thousands here.

Senior economist Jim Power said punishing tariffs that would have “devastated” beef exports —50% of which go to Britain — and a huge range of Irish food products that firms sell into Britain, look likely to be avoided. “This is the least-worst outcome,” Mr Power said.

The Economic and Social Research Institute had said a huge swathe of jobs stretching from Co Cork through the Midlands and across the whole of the north would have been vulnerable if Britain had crashed out of the EU without a trade deal.

Mr Power said the slump in the value of sterling against the euro since the Brexit referendum in June 2016 had badly damaged tourism as fewer Britons travelled across the Irish Sea.

Sterling, which was trading at 73 pence on the eve of the UK referendum, rallied last night but still traded at just above 90 pence. Shares in a clutch of Irish companies most exposed to fears of a hard Brexit, including Bank of Ireland, hotel group Dalata, and Ryanair, also rallied.

“It is not business as usual. There will be significant changes across the board. But at least the spectre of major tariffs hitting out most exposed exports sectors have been removed,” said John Whelan, head of trade consultancy, the Linkage Partnership.

Mr Whelan said the North, by remaining in the single market, could now prosper too. 

Aidan Flynn, head of Freight Transport Association Ireland, said: “Everyone will welcome that we can have a deal. There will be difficulties and complications ahead for freight but having a deal will improve relations between the two blocs which is really important from an Irish perspective and for the future.”