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Column Brexit is dangerous for Ireland if we're not prepared

Irish businesses develop their international business plans to mitigate against the risks coming down the road, writes Hugh Torpey.

IRELAND IS AN export country. We look outwards. Relentlessly positive in our mindset (and unrelentingly pessimistic in our words) we have a tendency to assume it’ll all work out, that ‘it’ll be grand’.

Sometimes though, a force comes that is just a little too big to get our heads around, a little too all-encompassing to simply wave away with a shrug. The solution used to be when these forces came along was to hit the bar and wait for it to pass by; nowadays it requires a bucket of coffee and countless brainstorming sessions in case it rolls over us.

Brexit is such a force.

The relationship won’t be the same

Every Irish exporter is aware of the dangers, and possibilities, of Brexit, and have probably elucidated these views at the end of a board meeting or over the dinner table. They have read the business papers, mentally taking note of those aspects of Brexit that will affect them, and have kept a keen eye on the exchange rates as they’ve fluctuated since June 2016.

Most Irish exporters, however, haven’t written anything down. There is no plan, just a feeling that we may have to be more flexible down the road. Maybe there’s vague notions that the Chinese market is opening up so ‘we must look into it’ or perhaps there’s a feeling Brexit won’t really happen. It will.

Maybe not in the ‘Hard Brexit’ that was the prevailing political wind until recently, but the UK is leaving the European Union and the relationship won’t be the same for the foreseeable future. It is now incumbent for Irish businesses, and exporters in particular, to develop their international business plans to mitigate against the risks coming down the road.

80% of Irish exports are either sold directly in the UK or transit through the region. Do Irish organisations have alternative market strategies in place? Does their export wing have plans for any transit barriers that may (suddenly) come into place?

Let’s take the tactical question first – are businesses prepared for a new set of administrative practices associated with transiting goods through Britain if it’s not part of the Customs Union?

Preparing staff or procuring new staff hires

In practical terms, this may mean businesses have to prepare staff or procure new staff hires to make this trade efficient. Imagine if tomorrow all exports needed to transit through Norway instead of Britain, what would be the challenges? What would be the costs associated?

Many Irish businesses are waiting for answers from the government rather than proactively seeking out alternatives themselves. Almost two-thirds of Irish export companies have said they are unprepared for Brexit, and have not put any counter measures in place over the last six months, according to a survey of 600 Irish businesses by Enterprise Ireland.

This is a dangerous strategy. We’ve seen the lack of clarity from all sides of the negotiation table, partly as a negotiation tactic in itself, and it is likely that the rules will come as one big release when negotiations are finalised. In other words, at the last minute.

Foreign Affairs Minister Simon Coveney has stated that companies using Britain as a transit location to other markets could be badly affected by Brexit, but has been unable to accurately track what goods, and it what volume, actually passes through Britain from Ireland. So, when it comes to negotiations on what goods are subject to custom tariffs, they may end up negotiating blind.

This makes it even more vital for Irish businesses to make their own plans. Of course, as the famous Navy Seal quote goes ‘No plan survives contact with the enemy’ but without a plan, we are doomed to fail.

Penetrating new markets

Now let’s return to the first question: If Brexit makes the UK less profitable to trade with, or at the worst-case scenario, becomes uneconomical to trade with, do Irish businesses have a plan to penetrate new markets to cover the gap?

Let’s be clear here, no perfect plan exists. There are too many variables within each sector, too many knowns, and even more unknown unknowns, to accurately sit down today and predict what we’ll need down the road.

And, ironically, when it comes to planning for this, it may be best to ignore the force that is Brexit for now. Instead, now is the time to formulate those international development plans and begin putting in place a plan of action.

The organisations who turn Brexit to their advantage will not be the ones who happen to be picked up by the tide and get lucky (although that will inevitably happen too) but the organisations that take a multi-pronged approach to the problem, tackling it from all sides.

They will not be able to share their plans with the rest of the class because, well, everyone is in a different class. This is a huge problem that will be tackled through a million solutions, tens of thousands of face-to-face negotiations across the world, through public and private sector policies and actions, and through lots and lots of planning.

Hugh Torpey is the Content Manager at the IMI (Irish Management Institute), Ireland’s premier provider of executive education.

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    Mute Waffler
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    Dec 1st 2011, 8:37 AM

    the biggest obstacle is religion

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    Mute Síomha Connolly
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    Dec 1st 2011, 9:17 AM

    The biggest problem is lack of education. I have lived in the AIDS capital of the world and religion was not the barrier there

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    Mute Waffler
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    Dec 1st 2011, 11:24 AM

    religion is a barrier to education

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    Mute Síomha Connolly
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    Dec 1st 2011, 2:10 PM

    Religion has nothing to do with this.

    It’s lack of education and knowledge. Full stop.

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    Mute Phillip Urrea
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    Dec 1st 2011, 4:45 PM

    I agree education is key, education in safe sex and removal of tribal cultures surrounding ‘cures’ for HIV, and especially key is the education of women – as they tend to be more likely to pass onto children, where culture and tradition have not yet become indoctrinated.

    However, Africa has a boom in Catholicism: http://www.africamasterweb.com/AdSense/AfricaAndCatholicism.html

    And the official Vatican stance and that of catholic relief and aid workers is that condoms are not to be condoned or distributed: http://www.pbs.org/newshour/bb/health/jan-june11/vatican_05-30.html

    This is despite condoms and testing being key to the decrease in HIV infections in the Western World.

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    Mute Síomha Connolly
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    Dec 1st 2011, 5:12 PM

    Have you checked the numbers between countries with many Catholics and those with the highest AIDS rates? They might not match as closely as you believe.

    Most of Southern Africa, which is where you will find those countries with the highest rates of AIDS are actually predominantly protestant:
    http://en.wikipedia.org/wiki/HIV/AIDS_in_Africa#Southern_Africa
    http://en.wikipedia.org/wiki/Catholic_Church_by_country#Africa

    Just to point out that I am actually an agnostic and so not a Church supporter but there’s no point blaming them for something that is not entirely their fault

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    Mute Phillip Urrea
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    Dec 1st 2011, 5:28 PM

    Without getting into lies, damn lies, and statistics I would wonder how much of those protestants in Southern Africa are from an ex-pat background and therefore less likely to be an victim of HIV?

    Like I say, I’m not discounting what you’re saying – I’d just like to see relief organisations (of which many are Catholic) move towards teaching and promoting safer sex, rather than unrealistic abstinence.

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    Mute Síomha Connolly
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    Dec 1st 2011, 5:35 PM

    Most of the Africans in Southern Africa are protestant.
    Most African catholics were converted by Catholic Missions who generally stayed around mid-Africa whereas the protestants (English, Dutch, etc.) settled and converted in Southern Africa.

    I’ve grown up there. I know the statistics

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    Mute Síomha Connolly
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    Dec 1st 2011, 5:39 PM

    I would like to say that I too, would like to see a realistic approach to teaching safe sex and use of condoms as opposed to using the ridiculous notions that Africans will follow the idea of abstinence

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    Mute John Murphy
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    Dec 1st 2011, 6:39 PM

    Siomha,

    I remember Bishop Desmond Tutu addressing a WHO conference and declaring that the attitude of Catholic missionary and aid groups to condom use had exasperated the spread of the disease in Africa.

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    Mute Si Mon
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    Dec 1st 2011, 9:59 PM

    Religion is only a small part of it – need to look at the bigger picture!

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    Mute Damien Kelly
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    Dec 1st 2011, 3:02 PM

    I’ve been living with HIV for seven years. If it wasn’t for the antiretroviral drugs I’d be dead. Huge advances in the treatment and decreases in the stigma attached to the virus have been achieved, but there’s still a long way to go. The virus is seen as a manageable disease and therefore not the threat is once was. This is folly. I wish the only impact on my life was the taking of a tablet each evening. Little is known about the long-term effects of these drugs; nor about the very real risk of dementia, cancers, pneumonia, skin conditions and the host of opportunistic infections being infected leaves you prone to. Education is everything.

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    Mute Kieron Mc Keogh
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    Dec 1st 2011, 11:53 AM

    Why does Concern’s Senior HIV Adviser never mention the use of CONDOMS to fight Aids in developing countries? NOT MENTIONED ONCE.

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    Mute Síomha Connolly
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    Dec 1st 2011, 2:23 PM

    I find that surprising as well. Condoms are the main way to prevent the spread of AIDS and nearly all anti-AIDS campaigns use those as their main platforms.

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    Mute Si Mon
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    Dec 1st 2011, 10:00 PM

    Maybe it is more than just the use of condoms that is important?

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    Mute Síomha Connolly
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    Dec 2nd 2011, 12:41 PM

    Si it is more but they are the best way to prevent AIDS spreading. Every campaign should highlight that

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    Mute Matthew Mark
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    Dec 1st 2011, 8:40 AM

    Could have sworn I heard the news on the radio say infection in young people here had risen sharply

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    Mute Paul Beggan
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    Dec 1st 2011, 8:54 AM

    The article doesn’t break down the infection rates by demographics so you could be right. The overall trend seems to be going the right way.

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    Mute KarlMarcks
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    Dec 1st 2011, 9:01 AM

    You did hear that. Young men 24 to 39 at highest risk, I think. Ignorance is on the rise because the heyday of AIDS campaigning was 20 years ago when they were little kids.

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    Mute Shanti Om
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    Dec 1st 2011, 5:13 PM

    Hmmm.. There were people in Swaziland eating faecal matter not so long ago because they couldn’t take their AIDS meds on an empty stomach (talk about skewed priorities – drugs are more important than FOOD now?)

    This article also points out that in the place where new infections are rampant nutrition and sanitation leave a lot to be desired..

    Wonder how many people in the 3rd world get “diagnosed” with AIDS when malnutrition and poor sanitation is the true reason their immune systems don’t work? Bearing in mind that the “tests” (ELISA and western blot) specifically state that they are unsuitable for determining the presence of HIV, a virus that has not been isolated. Rather these tests measure viral load and antibody response (and can test positive if you have the flu, are pregnant, or have just had a vaccine – hence the two tests taken several weeks apart).. There are people starving, they are obviously not adequately nourished, and instead of making sure that they can eat – drugs take priority (and companies like concern just keep pushing that appalling quality soy based muck and drugs approach rather than building self sustainability and organic farming)

    I do not wish to detract from the seriousness of the problem, but something here reeks of fish..

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