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INDOpinion

Businesses must be ready for Brexit

Wednesday, 4th September, 2019 4:37pm

Let me be frank.

Sometimes life deals you a bad hand, and Brexit is certainly a bad hand.

Ever since the Brexit referendum in June 2016, the challenge for Ireland has been to make the best of a bad situation.

Through no fault of our own, our country has been faced with an economic and political hurdle that poses real risks to the future of our businesses, and ultimately Irish jobs.

It is extremely frustrating for businesses that at this late hour, we still can’t say when and in which circumstances the UK will leave the EU.

I would love to be able to tell you exactly what is going to happen on 31 October but unfortunately that isn’t possible. I fully accept that that the lack of clarity complicates our Brexit contingency planning.

I also accept that it is incredibly difficult for businesses – especially small businesses – to plan for a situation that remains so unclear.

Notwithstanding this – and I am speaking directly to businesses here – there are certain steps you can take now.

As things stand, a crash-out is less than nine weeks away.

Against this backdrop, I am appealing to you to act now to help protect your business and employees.

My message to you is this:

• Look at your supply chains, customs procedures, certification, and standards and licencing processes

• Consider currency volatility and

• Familiarise yourselves with the many State supports and loans schemes available from Government, including through Enterprise Ireland, InterTrade Ireland and the Local Enterprise Ireland

• I am also strongly urging companies to register with customs for an EORI number. Without one of these, you simply won’t be able to trade with the UK after Brexit

The most immediate consequences of a hard Brexit are likely to be currency movements, supply chain constraints, delays, duties and tariffs.

In the first instance, this will put a strain on the working capital position of businesses.

So now is the time to put your safety nets in place.

One of the many supports we provide is the €300m Brexit Loan Scheme, which is designed to address working capital challenges brought about by Brexit.

Under the Scheme, loans of up to €1.5 million are available at a rate of four per cent or less, with loans of up to €500,000 available on an unsecured basis.

Similarly, the €300m Future Growth Loan Scheme is designed to support strategic long-term investment in SMEs in a post-Brexit environment.

These are loans that must be repaid, so the feedback has been that businesses are reluctant to take on debt in advance of Brexit.

That is understandable, but I want to be very clear that you are under no obligation to draw down a loan if you apply for one.

Eligibility remains valid for four months under the Brexit Loan Scheme, and six months under the Future Growth Loan Scheme.

Ultimately, it’s up to you whether or not you proceed, so my strong advice is to apply now and decide later. You could be very relieved to have the option there in a few months’ time.

Visit www.gov.ie/Brexit for a full list of supports.

In the meantime, the Government’s most recent steps to prepare for a no deal scenario have included:

1. issuing 27,000 letters to businesses in July and August urging them to sign up for an EORI number, with follow-up phone calls

 

2. launching our new Clear Customs initiative, to boost capacity in the sector, and give eligible businesses a €6,000 grant to take on staff

 

3. opening the Beef Exceptional Aid Measure for applications to support farmers

 

4. hosting ongoing events around the country, including Government outreach at the Virginia and Tullamore Shows.

 

Altogether we have held over 100 Brexit information seminars and events since last September, and that is set to continue in tandem with this, we will continue to work closely with the UK, through the EU Tas force, to do everything in our power to avoid a hard Brexit.

Donald Tusk has been clear that the EU stands

 

ready to listen to any workable solutions the UK might have.

The Government remains hopeful that solutions can be found, but we can’t afford to take any chances. That is why I am appealing to businesses today to grab the Brexit bull by the horns.

Yes, it is an unprecedented challenge but we are nothing if not a resilient people.

Ireland has navigated its way out of challenging times before and we will do so again. Just look at how far we have come since the recent economic crisis.

We cannot become paralyzed by Brexit. We must continue to plan ahead, focus on what is within our control domestically, and be the masters of our own destiny.

It’s time to tackle this thing head on. Together, we will face this.

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