Professor Alan Matthews:

If I might answer the questions in reverse order, I cannot see any new opportunities arising from Brexit that we do not have at the moment. I have no good news on that front. In terms of a timeframe and regarding uncertainty, the first of 12 principles mentioned by the Prime Minister today was a need for certainty. It is clear that we are into a negotiation on the initial phase of Article 50 that may last 18 months, if things go well. There will be a need for at least six months for ratification etc. One can imagine that there will be many occasions during that period when the newspapers will get hold of a leaked statement claiming the two sides are at loggerheads and headlines proclaiming talks will collapse or Britain will walk away without an agreement or whatever. The foreign exchange will react to such news. I agree with the Chairman that we will face an uncertain period. From an Irish point of view, it is key that we set out what we think are the best negotiating outcomes. During the negotiations we must focus on those outcomes and not be swept along on the tide of public opinion.

The EU negotiating position was mentioned by Senator Mulherin and others. I think it is a balancing act. From an Irish point of view we would like to retain close trading links with the United Kingdom, which is in our interest. She put her finger on the difficulty by asking what is the point of membership if the UK is given too favourable a deal. She wondered what differentiates membership from being on the outside but having all of the advantages. It is probably in our interest to keep the UK as close to us as possible. It looks like we will not be able to keep the UK in the customs union and it also wants to leave the Single Market. In terms of the free trade agreement, however, Ireland wants to try to retain tariff-free trade. That is where the impact of the industrial lobbies in the other member states may help us because they also will try to ensure that no new trade barriers are erected. I warn that there is a precedent in these kinds of trade agreements for the agriculture and food sectors to be treated somewhat differently and not necessarily covered by the same general arrangements. We may need to watch that we do not end up with less favourable arrangements for the food and agriculture sectors but a good deal on cars, which obviously would not help us.

The following two issues also were raised. Can we argue that Ireland is more exposed to the adverse effects of Brexit than other member states? If so, can we seek financial assistance from the EU budget? This is important and is worth thinking about. There are some arguments that we might find it difficult to do that, with one being that Ireland is a relatively rich member state, particularly after the revaluation of our GDP in 2015. While it has not really affected us in our pockets, the statistics indicate that Ireland still is one of the richer member states. If one of the responses to Brexit is to try to provide assistance to firms to enable them to diversify their exports to the EU market, then other member states obviously might not be that happy. The Dutch and the Danes also will be seeking alternative markets if the UK opens up to the Brazilians, New Zealanders etc. in a much bigger way than at present. Member states will question why Irish exporters get assistance while they do not. As the implications of Brexit become clearer, it will be worth making the case to the Commission to argue for transitional support. The Irish Government may want to provide support and the EU may provide co-funding. It is important that we at least make the case for support.

I am afraid that I have no expertise in the fisheries sector and must pass on the question. I recognise that fisheries is a huge issue.

I have mentioned that the issue of tariff-rate quotas, TRQs, might be important if we end up with the British withdrawing after two years without a trade agreement in place. In other words, TRQs are irrelevant if we have a free trade agreement because we would have full access without tariffs. TRQs are a fallback position if, after two years, the unthinkable situation occurs and we are trading with the UK on these so-called WTO terms. There would be no point in raising that question once the tariffs are in place. Clearly, we would need to negotiate with the United Kingdom if it began to look as if, for procedural reasons or negotiating reasons, a free trade agreement was not possible.

That would be the context in which tariff rate quotas may play a role but they are not one of the immediate issues because clearly we would hope that we could retain duty-free access through a free trade agreement.

Mutual recognition agreements are different because they will be necessary to avoid some of the negative consequences of the UK leaving the Single Market. We know that is going to happen, so we know that we need to put in place mechanisms whereby both sides will agree to recognise inspections, approvals and so on done by the other side. This does not only affect the food industry. As can be seen if one looks at the most recent report from the House of Commons on Brexit earlier this week, which entailed meeting business people in the north of England, it affects, for example, the pharmaceutical industry. They will be unclear as to whether their products can be sold legally in the European Union the day after Brexit because they will not necessarily have the clearances and certificates they will need unless there are some mutual recognition procedures in place. It is not only food that will be affected by this.