The prime minister is under pressure, economists are slashing growth forecasts and companies are warning of Brexit’s dire consequences. London? No, Dublin.
The intertwining of trade and finance means no other country is feeling the fallout from the U. K.’s vote to leave the European Union more than Ireland. In the year the Irish marked the centenary of their uprising against British rule, the country remains at the mercy of the unfolding drama in its closest neighbor.
‘It’s the most serious, difficult issue facing the country for 50 years,’ said John Bruton, 69, who was Irish prime minister between 1994 and 1997 and later served as the EU’s ambassador to the U. S.
Exporters have warned the plummeting pound will erode earnings and economic growth, just as a recovery had taken hold after the 2010 international bailout that followed the banking meltdown. Irish shares have declined, not least because the U. K. is the top destination for the country’s exports after the U. S. and the biggest for its services. Meantime, Prime Minister Enda Kenny is fending off demands by Northern Irish nationalists for a reunification poll as he comes to terms with the loss of a key EU ally and plotters from his own party try to topple him. Then there’s the future of the U. K.’s only land border with the EU.
‘The consequences are mind-boggling,’ said Eoin Fahy, chief economist at Kleinwort Benson Investors in the Irish capital.
This post was published at David Stockmans Contra Corner on July 18, 2016.
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