The Department of Finance has today published a new economic research paper, Brexit: Analysis of Import Exposures in an EU Context.
The paper examines the sectoral import exposures of the Irish economy and other EU Member States to the UK, building on a September 2017 Department of Finance research paper analysing export exposures. Together with previous studies, this report is a further contribution that will inform the whole of Government work on contingency planning.
The paper’s key findings include:
- Ireland is a substantial outlier amongst the EU-27 in terms of its import exposure to the UK, at an aggregate level, and in almost every sector. Ireland’s goods import exposures to the UK are even more pronounced than its export exposures.
- Food and live animals account for Ireland’s largest share of UK imports, with machinery and transport equipment, chemicals, manufactured goods, miscellaneous manufacturing articles and mineral fuels all also significantly exposed. This compares with the concentration of export exposures in a smaller number of sectors, in particular food and live animals and chemicals.
- Across the EU-27, thirteen of the top fifteen subsectors* most exposed to imports from the UK are Irish.
- The high import exposures highlight the potential disruption to Irish supply chains, particularly for the retail, agri-food and pharma-chem sectors.
- Regarding services, Ireland is considerably less exposed to the UK with regard to imports than exports, at both an aggregate and sectoral level.
Commenting on the publication of the research, Minister for Finance and Public Expenditure and Reform, Paschal Donohoe T.D., stated: ‘My Department has today published its latest Brexit research. This paper is the most recent economic assessment produced by my Department on Brexit and examines an area that has, until now, received less discussion, namely the impact of Brexit on imports’.
“Understanding all of the transmission channels of the impact Brexit will have on the economy is important to develop the appropriate policy response. The results highlight the need for us to continue take steps to prepare our economy for Brexit. We have been consistent in our position that it is in Ireland’s interest that, post-Brexit, there is the closest possible relationship between the EU and the UK, including on trade. This is in line with the March European Council Guidelines in December, which reaffirmed the EU’s desire to establish a close partnership with the UK.
“We continue to work closely with the Commission Task Force and our EU partners to progress the negotiations.”
* Goods are divided into ten sectors, as per the Standard International Trade Classification, e.g. Food and Live Animals. Subsector refers to the next level of product disaggregation within these sectors. The top five subsectors are all Irish and comprise gas, live animals, dairy products and birds’ eggs, cereals, and essential oils and perfume materials.
ENDS