Brexit Red Tape Will Shrink Irish-U.K. Trade, Central Bank Says
(Bloomberg) -- Irish-U.K. trade could shrink by almost 10 percent because of extra bureaucracy demanded by Brexit, Ireland’s central bank said in a study.
Barriers including longer waits at border crossings would cut total Irish exports by 1.4 percent and trigger a 3.2 percent drop in imports, the central bank said in a research paper published Thursday. Total trade between the two countries could dip 9.6 percent.
“The potential effect of tariffs following the U.K.’s departure from the customs union is well documented, but the impact of non-tariff barriers has received less attention, despite existing research that finds customs delays to be one of the largest of all barriers to trade,” said Mark Cassidy, the bank’s director of economics and statistics.
“This highlights the vital importance of negotiations on future arrangements for trade.”
Ireland is considered the European economy most vulnerable to Britain’s exit from the European Union. Policy makers want to maintain the closest possible trading relationship with Ireland’s nearest neighbor to try to minimize the economic cost.
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