Ibec, the group that represents Irish business, today welcomed a European Commission state-aid ruling which clears the way for a new Brexit support of up to €10 million to facilitate the restructuring of SMEs in Ireland. This has been a key Brexit ask of Ibec and is a significant step in demonstrating to companies that the Government is putting contingencies in place in the event of a hard Brexit.
Ibec Head of Tax and Fiscal Policy Gerard Brady stated: “Today’s ruling is an important step toward putting restructuring support in place for companies affected by Brexit. Brexit is likely to represent a serious disturbance to the Irish economy. In the event of a hard Brexit, support for a broader temporary state aid framework, moving past a focus just on restructuring, will be needed.
“Loss of UK exports, where it occurs, is likely to happen relatively quickly, while developing new markets takes a lot of time, risk and expense. Replacing exports lost in a hard Brexit could take five to ten years. Even within the single market, companies face barriers in establishing commercial relationships and supply-chains. In addition, they must build cash-flow, innovate and invest to tailor product to consumer tastes and deal with new regulatory regimes. The further goods travel the tighter margins will be as transport costs increase. Significant resources will be needed to help companies meet these challenges by supporting innovation, market diversification, upskilling and capital expenditure in equipment and machinery.”