Additional supports needed for business in border region with Brexit looming – Brendan Smith T.D.

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I have continually highlighted to Government the need to provide additional supports to businesses that are heavily reliant on the Northern Ireland and British markets.

The economy in Cavan/Monaghan is very dependent on the agri food, construction products and engineering sectors.  Northern Ireland and the British markets are big export destinations for these products.

Government must ensure that these sectors receive the best possible support in view of the challenges and difficulties that will arise for our local economy when Britain leaves the European Union.

Below is a report of recent Dáil Questions –

Brexit Supports

Brendan Smith

Question:

75. Deputy Brendan Smith asked the Minister for Business, Enterprise and Innovation her plans to introduce additional support measures for small and medium enterprises in the sectors in the Border region that will be most adversely impacted on by Brexit; and if she will make a statement on the matter. [30640/18]

As the Minister is fully aware, the economy of Cavan-Monaghan is very heavily dependent on the agrifood, engineering and construction products sectors. In turn, these sectors are very heavily dependent on exports to Northern Ireland and the British market. They are experiencing huge uncertainty because of Brexit and very anxious that all possible assistance will be provided to ensure existing levels of employment can be maintained and increased and to create much needed jobs in the region.

The work carried out by the Government on preparedness at all levels and all outcomes is well advanced, focusing, in particular, on trade with Britain. Brexit presents the most significant economic challenge of the past 50 years for businesses in all parts of the country and my Department and its agencies are working hard to ensure firms that potentially will be impacted on are taking the necessary steps to prepare and mitigate risks and take advantage of potential opportunities. I am conscious that further efforts are needed to ensure companies in the Border region are resilient to economic shocks, including Brexit. To that end, I am committed to ensuring Enterprise Ireland, the local enterprise offices and InterTrade Ireland will continue to work with companies in the region to drive innovation, competitiveness, internationalisation and Brexit preparedness.

My objective is to sustain the progress made in job creation and economic recovery. On the broader employment aspect, while the Border region had a relatively low unemployment rate of 4.4% in quarter one of 2018, I am conscious that more can and must be done. The north-east and north-west regional action plan for jobs will also boost enterprise and job creation across the Border region. In 2017 the number of Enterprise Ireland jobs increased by 7% in the north west and by 5% in the north east, while the number of IDA Ireland jobs grew by 4% across the region as a whole.

I am very conscious of the potential exposure of the northwest and north-east regions to Brexit and the deep links with local economies on both sides of the Border. The north west and north east already have special status in terms of state aid rules.  My officials are continuing to engage with colleagues in the European Commission as part of a state aids technical working group on how best to ensure we can support the transformation needed at firm level to diversify trade to third countries and protect rural economies. This group which also includes colleagues from the Department of Agriculture, Food and Marine and Enterprise Ireland will meet again later this month in Brussels.

A major initiative which my Department recently introduced for all firms impacted on by Brexit the €300 million Brexit working capital loan scheme, under which accessible finance is made available to businesses on favourable terms. Clearly, firms in the Border area are more likely to be impacted on by Brexit and should seek to avail of this funding. I am pleased that 12 firms have already applied for working capital, at an interest rate of 4% under the scheme. I am also working with my colleague, the Minister for Agriculture, Food and Marine, on proposals for a longer term finance scheme in order that firms can invest for the future and increase productivity and incomes.

Additional information not given on the floor of the House.  

More generally, the agencies supported by my Department are continuing to offer a comprehensive range of supports and guidance to firms in the Border area, as well as elsewhere. The six LEOs in the Border region also provide additional Brexit supports which are focused on capability building, market diversification, driving increased competitiveness and promoting innovation in orderthat LEO client companies can better cope with the challenges arising on foot of Brexit and explore opportunities presented. In addition, the LEOs work with their Northern Ireland counterparts under the EU Co-Innovate Programme.

In summary, I am committed to supporting the agencies within my remit to continue to respond to the needs of companies affected by Brexit to protect jobs and build resilience across the country.

I thank the Minister for her reply. I have referred on a number of occasions to the importance we attach to a good economy in our neighbouring counties of Fermanagh, Tyrone and Armagh. I welcome the fact that the Minister referred to this cross-Border interdependence earlier. I mentioned the three sectors upon which our local economy in Cavan-Monaghan is heavily dependent. The economy in the area comprising Armagh, Tyrone and Fermanagh is heavily dependent on those three sectors as well. We have a huge interest in ensuring that there are vibrant sectors north and south of the Border.

Due to the impasse at Stormont and the unfortunate fact that we do not have an Executive or a functioning assembly in Northern Ireland, what contacts are there at Department and agency level with the Northern Ireland authorities? We all have a joint interest in ensuring that the proper supports are put in place to deal with the adverse impacts of Brexit. Can the Minister give an assurance that work is ongoing at official Department level, and between our agencies here and agencies north of the Border? I know it is not easy at ministerial level as a result of the lack of a Northern Ireland Executive.

I thank the Deputy. I absolutely agree with him. As Chair of the Committee on Foreign Affairs and Trade, and Defence, Deputy Brendan Smith has been doing a huge amount of work to highlight the difficulties for the Border region that Brexit presents. I know that he recently brought parliamentarians to Cavan in order that they could see at first hand the impact that Brexit could have. The Deputy is also a member of the Joint Committee on the Implementation of the Good Friday Agreement. The work of that committee is now more important than ever in building bridges and maintaining good relations.

InterTradeIreland continues to work on a cross-Border basis. I am happy to go to the North and talk to businesses there at every opportunity. I attended the Northern Ireland Chamber of Commerce and Industry breakfast in Belfast some time ago, at which I spoke to businesses in Northern Ireland, discussing the impacts of Brexit and the need to strengthen those links. I met the Joint Business Council in Newry recently. That body is affiliated to IBEC. Again, it is about cementing those links and working more closely than ever in the face of Brexit.

I welcome that engagement. It is very important because so many of our companies have sister companies north of the Border. Thankfully, since the signing of the Good Friday Agreement in 1998, there has been a huge development of business on an all-Ireland basis. We want that to continue.

Have the Department or the relevant agencies carried out studies on the impact of Brexit on a geographical area? I know that one of the universities will be publishing material in August which shows the very adverse impact that Brexit will have on the Cavan-Monaghan area, as opposed to the east coast of this country. If the Department or the agencies have not done such studies, I think it is very important to do so. It would show that we need even more supports in our specific geographic area than those which have been put in place to date because of our dependence on the Northern Ireland economy and the British market. As we all know, many of the international corporations that we are so proud of today started off as one-person operations. The first export market they had from Cavan or Monaghan was to our neighbours north of the Border and then to Britain. It is very important that this market is protected as much as possible. We know of the difficulties with currency fluctuations as well.

A number of reports on the impact of Brexit right across the island have been carried out. Obviously, like Deputy Brendan Smith, I am particularly conscious of the Border region. Companies that have sister companies in Northern Ireland – the Deputy and I both know who they are – are working closely with Enterprise Ireland. There are a lot of supports available from Enterprise Ireland, InterTradeIreland and the local enterprise offices, LEOs. I wish to use this opportunity to encourage companies to engage with the LEOs, Enterprise Ireland and InterTradeIreland. There are a range of supports out there that they can avail of, and it is important that they do so. I want to see that happening, but sometimes it is hard for companies to do it. They say that they are not exactly sure. I would advise them to prepare for the worst and we will negotiate for the best. That is the best advice I can give them; to go to their LEOs, see what is available and use the supports.

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