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No-deal Brexit will damage local economies and jeopardise cross-border trade in Ireland, say local leaders  

​President Lambertz (archive)

Research suggests UK economy almost five times more exposed to dangers of a no-deal Brexit than regions in the EU27.

Local and regional leaders on 22 February voiced mounting concern about the prospect of the United Kingdom leaving the European Union without an agreement and the subsequent impact it would have on their communities. Referring to findings presented in Brussels today by a research consortium led by the University of Birmingham, the European Committee of the Regions (CoR) – the EU's assembly of local and regional leaders – warned of the dire economic and political fallout a no-deal Brexit would cause to local economies.

Karl-Heinz Lambertz, President of the CoR, said: "There is mounting evidence that a no deal will cause colossal damage to local economies in both the EU and UK, and it will be citizens who foot the bill. EU funds will be used to protect its most affected regions, but the warning is clear: the UK's economy is almost five times more exposed to Brexit than the rest of the European Union. We all want a deal and the deal on the table is immeasurably better than a disastrous no-deal." 

François Decoster (ALDE/FR), Chairman of the CoR's Brexit Interregional Group, which has 22 members from different member states, recently called for new EU funding within the EU regional funds – cohesion policy – for those regions directly impacted if there was a shift in status from internal to external border, an idea that was recently agreed by the EU.

Mr Decoster, who is Vice-President of the Hauts-de-France region, said: "As the representative of a region next to the Channel and home to one of Europe's biggest ports, Calais, I have known from day one that any form of Brexit will be bad news for our economy. But regions in the north-west of Europe are not the only parts of the EU that should be concerned. It looks likely that Brexit will increase regional disparities in many European countries, as well as in Ireland and the UK. The EU's cohesion policy will need to reflect this."

Raising concerns about the prospect of a no-deal on the island of Ireland, President Lambertz (BE/PES), added: "It is time to end political power games and to start putting citizens first instead. This means urgently guaranteeing all citizens' rights, and avoiding the dangerous consequences of a no deal which will create a hard border on the island of Ireland. The withdrawal bill agreed in November 2018 remains the best and only option available on the table."

Michael Murphy (IE/EPP), a councillor from Tipperary, the leader of the Irish delegation in the CoR and Vice-Chair of the Interregional Group, reiterated this message and said: "Brexit is lose-lose-lose for all involved and the research presented today reinforces this. We can say with certainty is that the impact of Brexit will be first felt at the local and regional level. In fact, Brexit is already impacting my own region, with a number of firms operating in the agri-food sector already closing due to the volatility of sterling. Regions that trade most intensely with the UK will be hardest hit – and, as research shows, the economies of many of those regions are already relatively weak."

The Committee has held a series of debates on Brexit over the past 22 months – including twice with Michel Barnier, the EU's Chief Negotiator in talks on the United Kingdom's departure from the EU. The debates, which have focused on issues including citizens, trade, and border regions, have highlighted the uncertainty faced by EU and UK citizens and the potential costs of Brexit to ports, the fishing industry, tourism, agriculture, and research and education. Mr Barnier is also expected to participate at the Committee's Summit of Regions and Cities in Bucharest on 14 March, just two weeks before the UK is expected to leave the EU.

With Eurochambres, the CoR also conducted a survey of local and regional authorities and local chambers of commerce, and it has commissioned an independent study that shows asymmetric economic consequences across Europe, with the worst consequences in the UK and in Ireland, with Belgium, France, Germany and the Netherlands among those most affected.

In two political resolutions, in March 2017 and May 2018, the CoR has placed the emphasis on securing peace and ensuring no border is erected on the Irish border, while calling also for the EU to ensure that local and regional governments are not left to deal with the effects of Brexit alone. The CoR supports a future relationship with the EU that enables close cooperation with the regions, cities, businesses and universities of England, Scotland, Wales and Northern Ireland.