Ireland's government on Tuesday outlined tax breaks for the tourism and farming sectors in a bid to offset the effects of the British pound's sharp devaluation and the expected impact of Brexit on the economy. In a speech to parliament on Wednesday Finance Minister Michael Noonan said that while the ultimate fallout from Britain's June 23 referendum was still unknown, Ireland would put on "economic shock-absorbers" to mitigate the inevitable damage.
"Whatever the final settlement, what we know with certainty is that Brexit has increased risk to the Irish economy," he told lawmakers. "As well as introducing specific measures to assist particular sectors of the economy, we must also put in place safety nets to protect us against future economic shocks," he said.
Noonan said Ireland wanted to retain the current economic ties with Britain as much as possible and to avoid the necessity for a hard border with Northern Ireland which he said would disrupt the economy. He outlined favourable tax treatment for several sectors, specifically tourism, food and agriculture, all of which are already coming under pressure because of the fall in the value of the pound of nearly 20 compared to the euro since the start of the year.
Ireland last week reduced its 2017 economic growth forecast to 3.5 percent after Britain, its biggest trading partner, voted to leave the EU. Trade between the two countries is worth an estimated 1.2 billion euros ($1.3 billion) a week. Ireland is the UK's fifth largest export market and imports more from the UK than any other country.
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