Negative effects already felt here as UK prime minister faces bruising attacks over deal
The first signs of Brexit’s true impact on Ireland have hit as investors fear Theresa May‘s proposed deal is already dead.
The British Prime Minister is battling to save her career, which now hinges on securing a most unlikely win in the UK parliament.
As a string of her ministers jumped ship, the Irish stock market took a €3.3bn hit, worse than anywhere in Europe. The rapidly unfolding crisis hammered Irish shares, leaving top-tier companies including Ryanair and Bank of Ireland facing big losses.
Despite the optimistic tones initially struck about Wednesday’s deal, plans for a no-deal scenario are continuing unabated in Dublin.
Tánaiste Simon Coveney told the Irish Independent: “All of that work continues because we can’t take anything for granted, that’s for sure.”
However, the Government remains coy about the full extent of the preparations already in place.
The Revenue Commissioners are preparing to hire more customs officials to support trade from next April. Revenue chairman Niall Cody said: “I don’t want people to come away from here saying everything will be all right.
“If it happens, there’ll be big challenges. There’ll be a lot of work involved but that’s what we’ll have to deal with.”
Irish shares were hit hard yesterday, with €3.3bn wiped off their value.
Investors fled shares likely to be most affected if the UK crashes out of the European Union next March.
The turmoil gave exporters a glimpse of the pressure they will face if order isn’t restored to UK politics in the coming weeks. The pound also took a dive, dropping nearly 2pc, its biggest fall this year.
Last night, Mrs May indicated she was determined to fight on despite a Cabinet revolt, an avalanche of attacks from MPs and letters seeking her resignation.
A key issue for the DUP, which props up her minority government, is a belief that Mrs May has abandoned Northern Ireland to EU rule.
It argues her agreement on a so-called ‘backstop’ aimed at maintaining an open border on this island will result in the North remaining fully aligned to EU regulations in the future.
DUP MP Nigel Dodds said: “The leadership of the Conservative Party is a matter for the Conservative Party but what we want to see is a Tory leader that will actually deliver on Brexit and most importantly, match their actions with their words when it comes to the integrity of the union.”
Dominic Raab, who resigned as Brexit Secretary yesterday, also claimed he was concerned that the proposed deal undermined the UK’s integrity.
He stood down despite being centrally involved in the negotiations with Brussels since replacing David Davis as secretary last July.
Asked about Mr Raab’s statement, Tánaiste Simon Coveney said: “What we have done is change the backstop essentially to try and accommodate British concerns to ensure there would be no customs checks between Britain and Ireland, to address a concern both he and the prime minster outlined.”
Amid the drama, Mr Coveney briefly met DUP leader Arlene Foster at the Republic of Ireland versus Northern Ireland soccer match in the Aviva Stadium last night.
However, the Irish Government will not be making any direct intervention into the dispute. A decision has been taken not to try and lobby individual Conservative MPs or the leaders of Westminster’s other parties, including Labour’s Jeremy Corbyn. But Mr Coveney did encourage Mrs May to be “tough, resilient and persuasive” in the days ahead.
The embattled prime minister defended her Brexit deal both in the Commons and during an evening press conference. She attempted to bat away the resignations of Mr Raab and her pensions minister, Esther McVey. Two junior ministers, two ministerial aides and the party vice-chairman also jumped ship.
Question marks remain over the staying power of environment secretary Michael Gove and international development secretary Penny Mordaunt.
The threat of a leadership challenge in the coming weeks is also now prominent as a trickle of letters seeking a confidence vote in Mrs May’s leadership of the party gathered pace throughout the day.
High-profile Brexiteer Jacob Rees-Mogg said the next prime minister should “believe in Brexit”.
However, Mrs May refused to buckle, warning again that it was her deal, no deal or no Brexit.
Brexiteer Tory MP Mark Francois described her deal as “dead on arrival”.
In Europe, French Prime Minister Edouard Philippe summed up the uncertainty when he said events in London raised concerns about whether it would be ratified. “We need to prepare ourselves for a no-deal Brexit,” he said.
A group of EU states including France also raised objections to what has been agreed so far on fishing between the EU and UK after Brexit.