German Economists: No Deal Will Hit Ireland Three Times Harder than UK

Germany’s prestigious IFO Institut has crunched the numbers on the economic impact of no deal on 44 countries and predicted that Ireland would be hit three times harder than the UK by a no-deal Brexit, taking a massive 8.16% hit to their economy. Guido hears that Ireland has been the main EU27 country holding out against any reference to the UK’s basic Vienna Convention treaty rights over the backstop. They may want to seriously reconsider their position after seeing these figures…

However, the Institut also modelled the effect of a “hard but smart” Brexit, where the UK left with no deal but also put in place large unilateral tariff cuts, more or less exactly along the lines of what what the Government is planning. In this scenario, the UK actually faces a smaller impact than the EU – they forecast a -0.5% impact on the UK compared to -0.4% for France and -0.48% for Germany, and -0.6% for the EU as a whole. Ireland is still by far the biggest loser, taking a -5.39% hit, ten times the size of the UK…

In their sector-by-sector breakdown, they find that the UK would actually receive a major boost to certain sectors in a “hard but smart” Brexit, with electrical equipment up by 3.7%, machine manufacturing by 8.4% and pharmaceuticals by a whole 8.7%. EU sectors lose out across the board…

Gabriel Felbermayr, the author of the report and also President of the Kiel Institute for the World Economy, said that the EU needed to “urgently ponder whether the danger of a hard Brexit isn’t bigger than initially assumed” and called on the EU to offer to remove the backstop “as a quick fix at least”. Brussels and Dublin can only keep sticking their fingers in their ears for so long…

H/t Pieter Cleppe


Euro News



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Emmanuel Macron comes over all euro-sceptic…

“We ended the day on what we can call a failure. It’s a very bad image we are giving of the Council and Europe, no one can be satisfied with what happened over so many hours. Our credibility is profoundly tainted with these meetings that are too long and lead to nothing, we give an image of Europe that isn’t serious. We cannot hold talks with world leaders, in an ever more violent world, and be a club that meets at 28 without ever deciding anything.”

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