Irish business has welcomed the EU-UK agreement on a Brexit transition period, arguing that it gives "vital" time for businesses to plan and prepare, while the legal backstop on the Irish border question will safeguard the all-island economy. However on the other side of the Irish Sea the response is more mixed.
On Monday, British and EU negotiators agreed a 21-month transition period that will start in March 2019,in what is seen as a decisive step towards the UK departing the European Union with a deal. However, many uncertainties remain, particularly on the question of the Irish border. As Michel Barnier, the EU’s negotiator commented, “nothing is agreed until everything is agreed.”
Irish business group Ibec welcomed the move, arguing that the Brexit transition deal gives business vital time to prepare, although it did note that “worrying EU-UK differences remain”.
“The agreed transition period will guarantee businesses at least 11 more quarters of full EU-UK alignment. It reduces the risk of a ‘no deal’ outcome and provides negotiators with more time to reach a final deal that keeps future divergence to an absolute minimum,” chief executive of Ibec Danny McCoy said.
Mr McCoy said that the legal backstop, which will avoid a hard border, is “important” for the many businesses operating on an all-island basis.
“Ensuring that similar customs and regulatory alignment continues east-west between Ireland and Britain, as well as north-south, must now be a priority,” he said.
However while many British business leaders embraced the deal, others were somewhat lukewarm .
The British Chambers of Commerce described the deal as a “milestone” that many businesses across the UK have been waiting for.
Adam Marshall, director general, said companies will now face little or no change in day-to-day business in the short term.
“While some companies would have liked to see copper-bottomed legal guarantees around the transition, the political agreement reached in Brussels is sufficient for most businesses to plan ahead with a greater degree of confidence,” he said, but warned against the transition becoming “a political football” later in the negotiation process.
Carolyn Fairbairn, director-general of the Confederation of British Industry described it as a “victory for common sense” that will help protect living standards, jobs and growth.
While Catherine McGuinness, policy chairman of the City of London Corporation, said the agreement “lifts some weight off the shoulders” of firms in the UK and the EU, she warned that the border issue still needs to be resolved.
And although James Stewart, head of Brexit for KPMG, said that the deal is “substantial and positive”, he argued that it will actually make little difference to business leaders.
“Legal certainty is what counts. So until we have legal certainty, our clients will continue to take action to prepare themselves for a no-deal”.
