THE IRISH Government is being encouraged to prepare an extra Budget for the country in the New Year due to uncertainties surrounding Brexit.
The Economic and Social Research Institute (ESRI) of Ireland have released a Quarterly Economic Commentary in which it says that Britain leaving the EU without a deal could affect Ireland in ways even more detrimental than first thought.
The commentary warns that the UK crashing out of the EU in a disorderly way-- ie a 'No Deal' Brexit-- could result in an recession in Ireland.
The commentary overview predicts that if the UK remains a part of the EU, the Irish economy "will grow by over 3 per cent".
"However, if a No-Deal Brexit were to materialise in late 2019, output growth could disipate entirely next year.
Indeed, it is not inconceivable that the Irish economy could contract in 2020 under such a scenario,"
The Irish government are already preparing the annual Budget under the assumption that a 'disorderly Brexit' will occur in the UK, however the ESRI recommend that this Budget be treated as a draft, and a second be drawn up in the New Year after the fall-out from Brexit can be measured.
The UK are due to leave the EU next month but have yet to reach any deal. British Prime Minister Boris Johnson has reiterated time and again that the UK will be leaving on the agreed date with or without a deal, making a disorderly Brexit exceedingly likely.
The ESRI's Quarterly Economic Commentary can be read in full here.
