Dr. Mark Cassidy:

That has always been a part of our advice.

The Deputy mentioned cliff-edge risks. I will give an example of the some of the cliff-edge risks that have come on our radar during recent months and quarters that we have had to address on many occasions along with the Department of Finance because we have shared responsibilities. There was a risk to the settlement of Irish securities in the event of a no-deal Brexit within the whole European framework and there were risks regarding the settlement of derivatives. Both of these risks have now been mitigated by European level legislation which allows for the settlement of securities and derivatives to be continued for two years in one case and three years in another beyond the Brexit deadline of 29 March.

We had concerns about the continuity of insurance contracts post Brexit. If there were insurance providers into this jurisdiction which were no longer authorised after Brexit came into effect, what would be the status of existing contracts with those companies for Irish citizens? As part of the overall legislative package announced last week, legislation to allow the run-off of these insurance contracts to occur over the next two years was announced by the Government and it will hopefully come into effect in early March. We have also been dealing with a very large number of authorisations for new applicants to come into Ireland, with which we have been engaging successfully in terms of the size of the sector.

The Deputy mentioned the challenges for firms locating here. I will not refer to any individual firms but in addition to a substantial increase in the size of the balance sheet of the Irish financial sector as a result of Brexit, we will also see new types of very sophisticated business models attracted here. We have known this has been on the horizon and this has involved challenges in terms of upskilling, interactions and liaising with other supervisors to ensure we are fully prepared to fully supervise all aspects of the business models of these new types of operations. We have done much in that regard.

On the question of whether Brexit is the biggest threat, it is clearly the most immediate one. If a no-deal Brexit materialises, it will certainly be the largest threat the economy has faced since the financial crisis. Over the longer term, I am not inclined to rank the threats. We will know about Brexit sooner rather than later. With respect to the figures I mentioned earlier, if a deal is agreed, the aggregate figures are reasonably large but not excessive, with the important consideration that certain sectors of the economy such as agrifood would be severely affected. With respect to the risks we are seeing in regard to the global taxation environment and risks regarding potential protectionist threats, Ireland is one of the probably about the fourth or fifth most open economy in the world. We have a very high degree of reliance on a small number of multinational firms and a high degree of sectoral specialisation. Approximately 55% of our goods exports are in the chemicals and pharmaceuticals sector and approximately 47% to 50% of our services exports are in IT type services. There are vulnerabilities there. We would be particularly affected if there was an escalation in protectionist trends or any changes to global taxation arrangements. These are all material risks. Brexit in the short term is the most immediate and the most in focus, but I certainly would not underplay the other medium-term risks.