As we currently stand, the Brexit camp looks set to lose in the UK ‘in-out’ vote of the EU looming next month.
The debate will certainly become more emotional the closer we get to June 23.
A terrorist event close to the date can still turn the vote into an immigration issue and all logic would be lost.
In reality, it could swing either way, so it is still worth looking through the arguments for and against and trying to determine the outcome of a ‘yes’ or ‘no’?
Certainly from an Irish perspective we seem to be more exposed than most but with government formation talks continuing longer than a world chess championship, the Brexit agenda is unlikely to get the political attention it deserves.
A casual glance at the trade figures between the UK and Ireland would show how important this is for both countries.
This year Irish imports from the UK are set to top €40bn, while we export to our neighbours about €15bn.
That is a lot of trade from the Republic.
Then take the emotional issue of fishing waters.
We have seen before in the cod wars that the UK can get aggressive about fishing rights.
What if the UK was not bound by EU restrictions?
Could we see a plundering of our seas?
That would certainly strain the good relations. So the Brexit vote matters, big time.
Let us look at the arguments for and against.
The strongest argument in the UK for the ‘stay in’ camp is the trade one.
The worry is that leaving the EU would hurt trade and those trade agreements which currently exist between the EU and major economies, including the US, would have to be negotiated independently.
The UK also has double digit, billion euro trade with Germany, France, Italy, Spain, Netherlands, Belgium, and Ireland, in exports and imports.
The EU is a trade bloc and as such the UK could not organise a bilateral trade agreement with any one of the EU states.
Article 50 of the Lisbon Treaty would be triggered and this would mean the 27 other states would work out how the UK would leave.
Then there is the prospect of a Europe moving ahead independently of the UK on a whole host of things — trade agreements, immigration policies, regulation issues, financial services, and security. The concept of a closer Europe was to trade with each other rather than to fight each other.
So is it prudent for the UK to abandon the process now?
Would Europe fall apart if the UK left?
Would it look attractive to other countries to leave?
Would Brexit be the downfall of the European integrationist project?
What about the pro-Brexit arguments. The issue of cost is a weak argument to say the least.
The net cost of membership is no more than £8.5bn (€10.8bn) a year, small in terms of the size of the UK.
Then there is the theory that the UK could relax regulation and unwind some of the red tape the EU imposes on member states.
Relaxing regulation is hard to do and rarely happens in reality.
Immigration is a major worry and the theory that the UK leaving the EU allows them to raise the drawbridge is also debunked when we see other non-EU countries struggling.
However, people are pragmatic. The UK is the fifth biggest economy in the world and if the UK were to vote to leave, no one is going to pull the plug on trading with the UK. That will be the reality.
Markets, politicians and civil servants know this and that is why any short-term movement in sterling or the UK stock exchange will be very shortlived.
My bet is that if there were a vote to leave, the effects on markets and the exchange rate would be shortlived.
Do not panic is my advice.
Like many big stories in the market, they are well priced in before the event.
The aftershocks are likely to add up to little more than a storm in a tea cup.
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