Brexit: Finance department of Ireland with calculations and reform measures

Last updated Sep 30, 2020

The government and economists are preparing for a new budget amid fears that a no – deal Brexit could have a devastating impact on Ireland’s economy, despite the COVID chaos.

The Finance Ministry report attests to the fact that, as everyone was concerned, COVID did not create such an impact. However, it has been able to hit the economy hard. In the October budget, the finance department is considering a policy reform to mitigate the effects of COVID-19 and Brexit.

The finance department is calculating the Brexit setbacks. According to the department of finance, the unemployment rate is expected to surpass the previous forecast. Unemployment, which was earlier estimated at 13.5%, has now risen to 15.9%.

Perhaps this will be the main challenge facing the country in relation to Brexit. The Finance department predicts that Brexit will grow by 1.4% next year. The decline is in line with the 6% jump forecast in April.

At the same time, the country’s GDP was forecast to fall by 10.5% in April. But according to a new report, GDP is projected to decline by only 2.5% this year. This is seen as an achievement.

In April, MDD estimated that the impact of multinational corporations on the economy would be reduced by 15.1% by 2020. But the current estimate is that it will be only 6.5%. The figures were approved by the Irish Fiscal Advisory Council ahead of next month’s budget.

The review of GDP indicates that there will be strong performance in the multinational exporting sector. However, the department says the impact of COVID-19 on the domestic economy is very serious.

Finance Minister Paschal Donohoe said the current macro-economic forecasts are based on two key assumptions;

First, from the beginning of next year, bilateral trade between the UK and the European Union will be subject to WTO terms. Second, it would lead to the conclusion that extensive immunizations are not available for the COVID-19 vaccine.

The COVID-19 pandemic will cause permanent damage to the economy to some extent. However, the government hopes that our policy will mitigate the impact of this, Finance Minister said.