Fianna Fáil Spokesperson on Finance Michael McGrath has warned that those negotiating on Ireland’s behalf on the terms of the UK’s exit from the EU need to be acutely conscious of the risks to Ireland of the UK being able to opt-out entirely from the EU’s State Aid rules.

Deputy McGrath commented, “There is regular speculation in the media that the UK government will seek to retain access to the EU Single Market in one shape or another and may be willing to contribute to the annual EU Budget. Given our incredibly strong trading relationship with the UK, it is undoubtedly in Ireland’s interests that we are allowed to continue to trade freely with the UK without any customs, tariffs or other trade barriers.

“At the moment, all member states are prevented from intervening directly with certain multinational companies or businesses on a selective basis under EU State Aid rules. If the UK is not subject to the EU State Aid rules, it may well be able to persuade firms to remain in the UK or to relocate to the UK with attractive financial incentives which cannot be matched by Ireland or any other EU country subject to the State Aid restrictions. This is a concern which has been conveyed to me directly by senior executives in multinationals in Ireland. Given Ireland’s strong record of achievement in the area of inward investment, this is an issue we need to ensure is an integral part of the negotiations.

“In the coming years, competition between countries from both within and beyond the EU for investment is likely to intensify. If the UK retains all the benefits of EU membership but is freed from the constraints imposed by State Aid, Ireland could be the big loser in terms of investment and jobs. There are many issues that need to be weighed up and negotiated after the UK triggers Article 50, but Ireland needs to ensure the issue of the UK’s relationship with the EU’s State Aid rules must be an important consideration in this process.”