With the European elections over, the focus of Ibec’s campaign activity is shifting in light of developments in Brussels, London and Dublin. In Brussels, the European institutions are going through a process of renewal. We now have a new Parliament, but the European Commission will also change soon, along with the leadership of the Council. In London, a Tory leadership contest is raising the risk of a ‘no deal’ Brexit. While at home, our attention turns to October’s Budget 2020, with the possibility of a General Election never far away.
Brussels: All change in Brussels with key roles up for grabs
The outcome of the European elections has disrupted established political alliances, but did not prompt a shift to the political extremes that many feared. Read our full analysis here. The European People’s Party (EPP), where Fine Gael sit, and the Socialists and Democrats (S&D) have been in coalition since 1979, but will now have to seek new partners after losing ground. The Greens and the liberal alliances ALDE (just renamed Renew Europe) will have more sway. Over the coming weeks, Ibec will be sitting down with our new MEPs to discuss the priorities of Irish business in details. Ensuring strong Irish voices on key Committee is vital. Our focus also turns to the next European Commission, where the process of choosing a new President in underway. We have set out our key priorities for the future of Europe, and will ensure that Irish business interests are strongly represented in the EU-wide debate.
Dublin: Focus on Budget 2020, but eye to General Election
At home, the focus is moving towards the autumn budget. The possibility of a snap general election has receded somewhat, although nothing is certain.
Early next month, Ibec will set out our priorities for Budget 2020. The macroeconomic backdrop remains benign - no other economy in Western Europe had greater momentum coming into 2019.
However, a ‘no deal’ Brexit would significantly re-frame the economic outlook, and involve a major sterling depreciation, cancelled investment, falling consumer confidence, rising prices and significant trade disruption.
At the same time, changes to international tax rules may demand a significant domestic policy response. We will set out our detailed plans on how government should respond next month.
London: Tory rhetoric puts Brexit ‘no deal’ in spotlight
The failure of the UK government to ratify the Withdrawal Agreement, has left business with the complex task and enormous cost of managing the uncertainty of moving Brexit deadlines. Millions of euro has already been spent putting in place costly contingency plans. The Tory leadership contest is polarising opinions further, and is increasing the likelihood of a ‘no deal’ outcome. There is no sign of a break-through, and the imminent arrival of a ‘Brexiteer’ UK Prime Minister is unlikely to change that.
The objectives of Irish business have not changed: an orderly exit with a long transition, legal safeguards to protect the Good Friday Agreement and all-island economy, and close future EU-UK alignment. In the meantime, our work to support you as you put in place contingency plans continues - get in touch directly or visit our dedicated Brexit website for support.