A ‘wait and see’ approach to Brexit is not an option, warns Julie Sinnamon

4 Sep 2019

Julie Sinnamon being interview at the Enterprise Ireland business breakfast to open International Markets Week. Image: Connor McKenna/Siliconrepublic.com

Irish businesses are urged to diversify and make moves into other international markets as the uncertainty of a Brexit deal continues.

Enterprise Ireland’s International Markets Week opens today at the RDS, Dublin, and a survey of companies attending finds that one in 10 Irish exporters say Brexit has cost their business more than €100,000, while almost 5pc say it has cost more than €250,000.

International Markets Week will host 650 Enterprise Ireland companies over its three-day run. The event offers these companies one-to-one meetings discussing export opportunities with more than 140 international market advisers from the State agency’s overseas offices. Naturally, this year, the focus is on opportunities in new markets as Brexit threatens Irish businesses’ long-running UK ties.

‘Preparing for a hard Brexit will be good for businesses, irrespective of the outcome of the negotiations’

Speaking at the opening business breakfast event, Enterprise Ireland CEO Julie Sinnamon said: “Our research shows that Irish exporters are already feeling the negative impacts of Brexit through their profit margins. We have consistently said that the wait and see approach is not an option and client companies are heeding this advice.”

The majority (53pc) of companies attending International Markets Week say that Brexit has had an impact on their business. Among their chief concerns are currency fluctuations (33pc), tariffs (22pc), supply chain disruption (16pc) and general uncertainty on the outcome of Brexit (15pc).

Opportunities elsewhere

The current Brexit deadline of 31 October is nearing. However, with a rocky return for UK parliament seeing prime minister Boris Johnson lose his narrow majority and Tory rebels teaming up with the opposition to demand an extension into January 2020, the situation remains entirely uncertain for businesses caught between the two nations.

Nonetheless, Enterprise Ireland is actively encouraging client companies to take action on Brexit preparedness and further their diversification plans.

‘The Eurozone offers a potential customer base of over 340m people, and has the advantage of having no currency volatility, no trade barriers and full regulatory alignment’

The Eurozone is the most obvious and popular choice among those companies surveyed. Minister for Business, Enterprise and Innovation Heather Humphreys, TD, noted: “The Eurozone offers a potential customer base of over 340m people, and has the advantage of having no currency volatility, no trade barriers and full regulatory alignment.”

Humphreys also highlighted that work on Brexit preparations is “the highest priority across Government, particularly as the likelihood of a no-deal Brexit increases”, and encouraged companies to avail of supports in achieving first-time sales in new markets.

These supports include management development programmes, inward buyer visits and the Market Discovery Fund which, since 2018, has delivered more than €9m in funding to companies seeking to enter new markets.

According to Enterprise Ireland, more than 200 client companies saw significant Eurozone market engagement in the first half of the year, and 57 Irish companies established a new presence there.

“In 2018, 945 new overseas customers were secured by clients with the support of Enterprise Ireland. This represented a 23pc increase on the 770 new overseas customers recorded in 2017,” said Sinnamon. “Overall, Enterprise Ireland client companies have opened 275 new overseas presences in the first six months of 2019.”

Sinnamon urged Irish businesses to continue to find new markets and to innovate their products and services. “Our continued priority is to ensure that Irish exporters prepare for a hard Brexit, and to take action now. This will be good for their businesses, irrespective of the outcome of the negotiations,” she said.

Elaine Burke is the host of For Tech’s Sake, a co-production from Silicon Republic and The HeadStuff Podcast Network. She was previously the editor of Silicon Republic.