Any exporter looking for a reassuring word or two about the impact of a possible Brexit would have taken little comfort from comments made by Enterprise Ireland head Julie Sinnamon yesterday.
Announcing updated figures on the performance of client companies, she had surprisingly little to say about the referendum, the results of which could prove difficult for many Irish SMEs.
While keen to note how exporters have become less dependent on the UK in recent years, when asked directly about what advice Enterprise Ireland had for Irish companies exporting across the water, she was less forthcoming and resorted to discussing how her organisation was helping firms “with their lean agenda” and “to improve their competitiveness position”.
All very helpful in the long run no doubt, but not particularly the words that exporters to the UK – the typical first market for SMES – would like to hear right now.
While sterling rallied yesterday after new polls suggested the campaign for the UK to remain in the EU was gaining momentum, the pound has fluctuated widely in recent days, adding to costs for exporters. Such costs would likely skyrocket if the Britsh vote to leave on Thursday.
Indeed, currency traders predict sterling will fall to record lows against the euro in the event of a Brexit, perhaps nearing parity for the first time since the single currency’s 1999 launch.
With the issue of Britain remaining in Europe dominating the business agenda, it would have been comforting to hear that Enterprise Ireland had a strategy in place to deal with a Brexit.
This is particularly so as Ms Sinnamon acknowledged that “the UK is and will continue to be our number one export market”, even as exports to Britain have declined in recent years as companies seek alternative markets.
The latest figures show exports to the UK as a proportion of Enterprise Ireland’s total client exports fell from 45 per cent in 2005 to 37 per cent last year as companies diversified into Northern Europe, the US and so-called “high-growth” markets such as China and India.
While the long-term forecast suggests exporters will continue to look beyond our nearest neighbour for growth opportunities, the likelihood is the UK will remain the first port of call for any company looking to expand beyond Ireland.
No matter what the result on Thursday, uncertainty will persist. Let’s hope Enterprise Ireland evolves its strategy for supporting companies operating across the water.