McWilliams seems to support Brexit but does reason?
Economist David McWilliams has controversially said that Brexit could be bad for Britain but good for the Irish – but isn’t David forgetting how bad it could be for the North?
As the British Government’s campaign to stay in the UK continues to gather pace after David Cameron’s wobble earlier this year – it seems McWilliams could be a fan of an EU exit for our British neighbours, to allow us to eat the spare fat from their land.
McWilliams posed the question what would happen if Britain exited the EU, writing in the Irish Independent: “If direct foreign investment, particularly American direct foreign investment, doesn’t go to the UK, where will it go? What is the country that feels, smells and tastes like Britain, but isn’t Britain? Where would US executives feel most at home, with tax rates that are attractive and full access to the EU? Yes, you guessed: Ireland.”
It seems that McWilliams may be forgetting how potentially bad for Northern Ireland any move for Britain to leave the EU could be.
Earlier this month top Conservatives on both sides of Britain’s Brexit debate warned that border controls with the North could be introduced if the UK votes to leave the European Union.
Former chancellor Nigel Lawson, chairman of the Vote Leave campaign, said checks would be necessary along the border to prevent illegal immigration.
He told Andrew Marr on the BBC: “That could be stopped. There would have to be border controls, but not a prevention of genuine Irish coming in.”
Justice minister Dominic Raab, campaigning for Britain to leave the EU, agreed that Brexit could see an end to the open border between the two parts of Ireland.
“If you’re worried about border controls and security . . . you couldn’t leave a back door without some kind, either of checks there with any country or assurances in relation to the checks that they’re conducting, obviously.
“Otherwise, everyone with ill will towards this country would go round that route,” he told Dermot Murnaghan on Sky News.
But McWilliams still argues for economic power for Ireland, clearly not taking in to account the possible political and social implications of any British exit.
“Far from it being in our interest for the UK to stay in the EU, it is in our commercial interest for the UK to be mired in red tape, uncertainty and fog. So why is our government actively campaigning for the UK to remain in the EU? Why are we doing Brussels’ job, when it’s not our job to advocate anything in the domestic politics of a quasi-foreign country.”
It seems McWilliams feels better apart that together when regarding Brexit, as he states: “In short, Brexit may actually be good for us in the long term, particularly if the damage to the UK’s investment image is as bad as the Remain camp claims it will be if the UK leaves. Clearly, British-bound investment will be diverted elsewhere.
“Remember, our country is 15 times smaller than Britain and therefore we only need a small amount of that diverted FDI for it to make a massive difference. If we veto the EU’s vindictiveness, we insulate ourselves from the extremes of Europhilia and arrive at a sensible conclusion.
“Despite this obvious scenario where we can play a canny game, official Ireland is doing Brussels’ bidding campaigning to make sure that the UK stays in the EU . . . by hook or by crook. Strange.”
The UK and Ireland’s economies have always enjoyed a close relationship, however. Davy stockbrokers feel that if the UK-EU relationship was significantly affected by trade “barriers and tariffs,” then the “consequence” for Ireland could be “significant.”
Senior investment strategist Robbie Kelleher said: “Then the consequences for the Irish economy could be significant. The dependence of the Irish economy on the UK has fallen in recent decades, but it remains an important trading partner.
“When Ireland and the UK joined the EEC in 1973, over 50% of Irish exports went to the UK. That figure has dropped to just over 16% today. Although over 40% of Irish exports go to the remainder of the EU, the UK remains our single most important export market in Europe. Some 20% of Irish exports now go to the US.
“The true importance of the UK economy as a trading partner is understated by these figures. A significant portion of the growth in exports to the US and mainland Europe reflect the operations of the multinational sector where the real value added is diluted by transfer pricing.
“In contrast, a much higher proportion of exports to the UK are from indigenous Irish industries where the real economic value added is considerably higher.
“Perhaps a better indicator of the economic relationship between the two economies is the fact that more than one-third of Irish imports come from the UK.”