Brexit: What’s next

The decision of the UK referendum to leave the European Union will have significant implications for Irish business. We are committed to supporting organisations manage the uncertainties and present our insights and expert opinions here.

Statement from Feargal O’Rourke, Managing Partner

"Irish business needs to consider the implications of Brexit and plan accordingly. We have been supporting our clients with their readiness plans and we advise organisations to continue to focus on their growth plans while developing strategies to manage the challenges and opportunities ahead.

"Many Irish businesses have come through the worst recession in decades and have shown great resilience. I have no doubt that with our natural strengths and agility, Irish business will navigate these uncertain waters and emerge stronger than before.

"With direct access to the EU, a pro-business environment and a highly skilled English-speaking workforce, Ireland continues to be a great location for investment, as well as a superb platform for international business."

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Brexit: What’s next - Managing the disruption

Feargal O’Rourke, PwC Managing Partner, outlines the potential implications of Brexit for Irish business and how can they manage the uncertainties


Explore our insights

For more of our Brexit insights, see below...

Brexit: What’s next - The road ahead

Ciaran Kelly, PwC’s Head of Advisory, outlines the threats and opportunities your business may face due to the UK’s decision to leave the EU

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The key things to think about after Brexit...

Sterling movements (especially short to medium term volatility)
Regulatory changes impacting capital efficiency and cost
Additional administration e.g. new customs requirements
Changes in routes to markets - physical and virtual
Forced changes in your business models e.g. locations, effectiveness of branches and subsidiaries
Will staff be able to move as freely within your group of companies; what will be the impact on their incomes?
Taxation changes - corporation tax; VAT; custom duties
Legal issues - e.g. invalid contract clauses

Explore our insights


Brexit: What’s next - International mobility

The issue of international mobility attracted a lot of focus in the run up to Brexit. Ireland may now have an advantage in the war for talent as the only remaining English-speaking country in Western Europe

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Macro-economic impacts

We expect the most important results of Brexit will be in the following areas:

Exchange Rate
The immediate effect of the exit vote and the resulting uncertainty was evident in European markets which fell dramatically after the referendum result to leave the European Union was announced. This would make our exports to the UK more expensive, although our imports would be cheaper.

People and mobility
Britain’s exit from the EU is likely to lead to restrictions on immigration to the UK (and vice versa). EU citizens may need to obtain permission to work in the UK under rules similar to the current immigration requirements for non-EU citizens. Changes to the free movement of labour, would have a significant impact on Irish citizens.

Foreign Direct Investment
A ‘leave’ result in the Brexit referendum was initially believed to be a good thing for Ireland, as it was thought that the UK would be a less competitive FDI proposition. However, this needs to be reconsidered as the UK would be free to create investment friendly tax policies that may divert attention from Ireland as an FDI option. Notwithstanding this, Ireland’s position as the only EU country with English as its first language may be beneficial. 

Impact on industry

The main industries we believe will be affected, and the resulting impacts, include:

Financial Services
Changes in corporation tax, VAT, capital and currency controls and passporting may see businesses considering where they are located. Operating under two (UK and EU) regulatory frameworks may require changes in capital structures and would multiply the costs of compliance.

Agri-food
UK exit negotiations will focus heavily on trade and that’s where Ireland’s will be most impacted. Barriers and tariffs are now a real possibility, with the EU unlikely to allow member states to negotiate individual trading agreements. Given this, it is likely that competition from Non-EU nations to increase their presence in the valuable UK market. However the UK will remain an important market for Ireland, as exports are valued at €4.5bn and imports €4.1bn.

Energy
The decision by the UK to leave the EU means they will no longer be bound by Member State commitments to establish a single energy market for Europe. The impact of this could have significant effects for our own energy sector, which has radically diversified its energy mix in recent years. Ireland imports 85% of its energy from the UK, and changes in the energy relationship may impact costs to households and businesses alike.


Contact us:

Contact us

David McGee
Partner
Tel: +353 1 792 8785
Email

Enda McDonagh
Partner
Tel: +353 1 792 8728
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Joe Tynan
Partner
Tel: +353 1 792 6399
Email

Ciarán Kelly
Partner
Tel: +353 1 792 6408
Email

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