Ireland must adopt measured approach to Brexit challenge

Since the Brexit referendum there has been quite a bit of criticism of the Irish Government because it has not come out and published a contingency plan for Ireland to deal with the UK decision.

Given that we still have no idea how the saga is going to unfold, I find it a bit bizarre that media and others should level such criticism. 

Even if a detailed contingency plan is in place, which I very much doubt, it would be naïve in the extreme to come out and talk about it, given that there are still so many unknown unknowns. 

Furthermore, if a plan were in place, I suspect it wouldn’t be worth the paper it is written on, given that we still have no idea how the situation is going to unfold, or over what timeframe.

Recent events in Westminster are suggestive of a political system that is in a very bad place, but closer to home our own political system is pretty dysfunctional, and seems to be populated by many individuals who could be charitably described as opportunistic.

The call to begin a discussion on holding a referendum on a united Ireland is one of the more bizarre suggestions I have heard over the few weeks.

Why we would possibly contemplate a referendum at a time when policymakers are struggling to deal with the challenges that exist on this side of the border beats me.

On the other side of the border, the North has an economy that is heavily subsidised by Westminster; the public sector accounts for an inordinately large part of the economy, and it is still in the early stages of trying to build up a diverse enterprise-based economy.

It is also clear that the political divisions run deep on the ground and it is still a very divided society. Imposing a referendum on the unionist population and indeed on a certain segment of the nationalist population would not be such a good idea, I suspect.

Integrating both parts of the island would be a nightmare and the German reunification process would seem a cakewalk by comparison.

However, in times of crisis there are always opportunists waiting to hop on the bandwagon and create mischief.

Rather than seeking to push for a referendum on a united Ireland, the government here should be totally focused on short-term issues such as the potential impact of Brexit on the UK economy over the coming months, and the ongoing weakening of sterling and the possibility of considerable currency volatility over the coming months.

The longer-term concerns should revolve around the sort of relationship that the UK, if it does actually go ahead and leave the EU, would have with it.

There is also the matter of how to deal with and exploit the possible opportunities that might arise if the UK does leave.

The UK is a very important trading partner for Ireland and a recession there, or a further sharp fall in the value of sterling, would not be good news, putting it mildly.

To deal with both of those eventualities, Ireland will at least need to be as competitive as possible.

In April, the National Competitiveness Council warned in its report, ‘Costs of Doing Business in Ireland’, that Ireland ‘remains a relatively high cost location and already the return to growth has resulted in a series of upward cost pressures’.

It lists a whole range of costs where Ireland fares relatively badly. 

A Brexit strategy should look closely at what should be done to address these cost issues.

Longer term, policymakers will need to ensure that, if the IDA is successful in attracting investment into Ireland due to Brexit, the country will be able to deal with an influx of investment and workers. 

Basic amenities such as housing, public services — such as health and education — public transport, IT, physical infrastructure, and suitable office accommodation are already lacking.

If the UK does actually invoke Article 50 and proceed to leave the EU, the Irish Government should do all in its power to make sure Britain gets the best deal possible and that certain EU countries do not conduct a vendetta against what is a very large and very influential economy in Europe.

Meanwhile, the Irish Government should not be pushed into rash actions or contingency plans by media or populist politicians in the Dáil.

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