According to the Irish Taoiseach, his country’s Presidency of the EU for the second half of 2026 will be an exciting opportunity for Ireland to pursue a deal, which can deepen Europe’s capital markets to mobilise trillions of Euros in savings into productive investments.
UK suffered economically after Brexit
By contrast, the tenth anniversary of Brexit for the UK has been a depressing reminder of our country’s self-harming belief in ‘British exceptionalism’ (i.e. that the UK would become “global Britain” if it left the European Union). The Centre for Economic Policy Research (CEPR) suggested in December 2025 that Brexit had reduced UK GDP by 6% to 8%: “Investment, employment, and productivity were all affected, reflecting a combination of elevated uncertainty, reduced demand, diverted management time, and increased misallocation of resources.”
In addition, new research by the Centre for European Reform has shown that UK services exports to the EU are 7% lower and goods exports 16% lower than they would have been without Brexit, with little evidence of UK trade being diverted instead to non-EU countries.
Not only economic constraints
It is, of course, not just economic constraints that UK citizens now experience. The restrictions on our freedom of movement in Europe have been particularly acute for those of us with professional or family links to the EU, as all Brits are now limited to a cumulative total of “90 days in 180” if spending time in any of the 25 EU member states which are members of the Schengen area.
Thankfully, because of the Common Travel Area, this restriction does not apply to the Republic of Ireland, and recent visits there have reminded me what a transformation has taken place in Eire because of its EU membership.
What has Ireland gained from EU membership which the UK has lost?
When both the UK and Ireland joined the European Economic Community simultaneously on 1 January 1973, Ireland was one of the poorest country in Western Europe. Membership of the EU, as it is now known, has facilitated a transformation from an economy depending on antiquated agriculture, to one largely driven by hi-tech industry and global exports.
A country transformed
Unlike the UK, Ireland adopted the euro in 2003, thereby distancing itself economically from Britain and moving closer to the rest of the EU. This encouraged many multinationals to locate their European headquarters in Ireland, as an alternative to the UK, being an English-speaking, Eurozone country.
Ireland then suffered a significant setback with the financial crash, in 2009, but was able to negotiate an E85-billion rescue package with the EU and the IMF.
Having visited Ireland several times as a child, a decade before the two countries became EEC members, on returning in 2024, I was immediately struck by the transformation of the Republic, both socially and economically.
Whilst staying last year on the remote Dingle peninsular, the most westerly the point of Europe, it was clear that the local population were affluent, confident, well-travelled and cosmopolitan in their outlook. This has been confirmed repeatedly in two further visits to the country.
Pubs and restaurants are fully booked, with families eating out regularly and taking holidays abroad. Young people have money to spend and are optimistic about their future. The community spirit is strong, and tourism is thriving.
On checking Ireland’s current GDP per capita, it proved to be the second highest in the EU, after Luxembourg! In fairness, heavy foreign direct investment and multinational operations routing global profits through Ireland for tax purposes have inflated the standard GDP metric in Ireland. (This practice may be coming to an end, as US policy catches up.)
However, when factoring in purchasing power parity and looking at actual household consumption, Ireland’s levels are now roughly on a par with those of the UK, which has a relatively lower cost of living. So, since joining the EU, Ireland has, at the very least, caught up.
Some statistics quoted by the Irish representation to the EU include:
- Since 1973, services grew from a 45% share of the workforce to around 80% in 2025.
- The EU’s Single Market environment, adoption of the euro currency in 2003 and support from EU economic and fiscal policy coordination ensures Ireland’s economy remains stable and competitive.
- The Trade in Goods balance (exports minus imports) changed from a deficit of €340 million in 1973 to a surplus of €52.97 billion in 2023.
- From 1973 up to 2018 Ireland was a net recipient of over €40 billion in EU funds. The country is now a net contributor to the EU budget but the benefits of being part of the single market are estimated to be worth more than €30 billion.
- Single Market access helps create jobs as Irish exporters can sell more easily and cheaply into lucrative global markets like Canada, Japan, South Korea and Singapore thanks to international EU trade agreements.
- Ireland’s labour market is stronger than it has ever been, with a 75.3% employment rate in 2024 and an unemployment rate of 4.2% in December 2024.
Impacts of Brexit on the Republic and Northern Ireland
Because of the land border with Northern Ireland, the impact of the UK’s Brexit on the Republic of Ireland was significant, as, in addition to implications for trade, customs and immigration checks, it created unnecessary complexity in relation to services, recognition of qualifications, medical cooperation and regulatory checks.
The impacts on Northern Ireland of Brexit have, however, been potentially traumatic, leaving the country, which is, of course, a constituent part of the UK, in danger of drowning in complexity.
In 2016, at the time of the Brexit vote, it was perhaps unsurprising that the repercussions of Brexit for the island of Ireland were not considered by the government of Boris Johnson.
Unfortunately, this was in line with the lamentable history of the UK’s lack of concern about its Irish subjects over centuries, most notably when Victoria and Albert threw themselves into preparing for the Great Exhibition held in London in 1851, at a time when over one million Irish perished in the Great Potato Famine, with two million being forced to emigrate.
The partition of Ireland took place in 1921, after the War of Irish Independence from 1919 to 1921, when the UK was exhausted by the First World war. Subsequently, when the UK and the Republic of Ireland both became members of the EEC in 1973, this was helpful in the context of the need, at the time of the Good Friday agreement of 1998, not to have a ‘hard border’ on the island of Ireland, between the Republic and the six counties of Northern Ireland,
To create a hard border after Brexit would have unravelled the Good Friday Agreement, under which the Republic had amended its constitution, removing a claim to sovereignty over Northern Ireland; the Irish Republican Army (IRA) had laid down its arms and a devolved Northern Ireland had been created, in which Unionist and Republican powers could share power.
Northern Ireland had, of course, voted against Brexit.
Northern Ireland Protocol
The eventual Brexit withdrawal agreement between the UK and the EU therefore included the Northern Ireland Protocol, designed to maintain an open border on the island of Ireland, by keeping Northern Ireland aligned with the EU single market for goods. This effectively created a trade boundary in the Irish sea. The Windsor Framework, agreed by Rishi Sunak when UK Prime Minister, was designed to make these arrangements less burdensome on international trade.
The impact of Brexit on the Republic of Ireland was, nevertheless, still significant, as in addition to implications for trade, customs and immigration checks, it created unnecessary complexity in relation to services, recognition of qualifications, medical cooperation and regulatory checks, as a direct result of the UK leaving the EU.
One particularly complex situation relates to the introduction by both the EU and the UK of Carbon Border Adjustment Mechanisms (CBAM), implemented by the EU in 2026 and due by the UK in 2027. The EU CBAM does not directly apply to goods produced or consumed in Northern Ireland, but the UK CBAM will apply. The fact that the Republic and Northern Ireland share a Single Electricity Market, makes this situation particularly complex.
As made clear in the Radio 4 programme Currently on 22 June, an even more significant issue which was highlighted by Brexit was the increased interest in a ‘border poll’ on the Unification of Ireland, which the Good Friday Agreement promised if it appeared that there was a majority for it in Northern Ireland.
Even though more of the population is becoming secular, it is unclear whether there is sufficient interest in the issue to deliver a unification referendum. There is, nevertheless, an awareness that the economy of the Republic is significantly ahead of that of the North.
Time will tell.
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