Damaging Brexit deal could drag rural Ireland back into a recession, with up to 40,000 jobs at risk and areas in counties Cork, Kerry and Tipperary worst affected because of their reliance on farming.
Two leading economic think-tanks issued the dire warning as they lashed out at the risks posed to this country by the UK’s departure from the EU.
Speaking to the Oireachtas housing committee, the Economic and Social Research Institute (ESRI) and the Nevin Economic Research Institute said it is clear Ireland could be worst affected by any problems resulting from the situation.
And while saying Dublin could benefit to an extent by an influx of people fleeing the UK, other parts of the country including the south-west, southeast and the border region risk being badly damaged.
Responding to Solidarity-People Before Profit TD Mick Barry, the ESRI head of economics Kieran McQueen said the reality is a bad deal “is going to be very difficult” and could see the agriculture and construction industries “very seriously impacted”.
Highlighting concerns for farming-focussed local economies in north Cork, Kerry, Tipperary, the southeast and the border, Mr McQueen said “there could well be key regional differences” in any fallout.
“You could see an overall depressing effect on the housing market and economy nationally, Dublin could be quite different, but that could be somewhat different to the regions.”
His concerns were repeated by the Nevin Economic Research Institute’s director Tom Healy, who said he is equally fearful of a damaging Brexit and believes “much more than 20,000” jobs predicted to be at risk could be lost.
Citing the same issues surrounding the “border areas, southwest and southeast”, which he said may be “very adversely affected” if any deal goes wrong, Mr Healy said “there is a risk of greater inequality, social and economic inequality”.
“If you look at those affected, particularly in the agri-food sector, you could have a chain reaction which percolates out,” he said when asked about his job losses prediction.
“In rural areas and the border you could be looking at a much more negative impact than said.
“That could be counter-balanced by inward migration in Dublin, but it could be much worse than the 20,000, 30,000, 40,000 suggested,” he said.
Both Mr McQueen and Mr Healy said even if Dublin survives a Brexit fallout, it is likely to face a fresh housing crisis which could see vital social housing and Rebuilding Ireland funding scaled back.
Asked by Fianna Fáil senator Jennifer Murnane O’Connor about other bad deal risks, Mr Healy replied: “Higher costs, temporary shortage of materials, availability of skilled construction labour from Northern Ireland, increased demand for housing.”