There is no economic Plan B

Posted By: June 25, 2016

Gary Mc Donald. Irish News (Belfast). Saturday, June 25, 2016 

WE’VE jumped over the cliff – and now we’ll have to be pretty damned quick in strapping on a parachute otherwise it’s going to get pretty messy.

I waited and watched for weeks, months probably, for accurately evaluated economic reasons why we should sever ties with the biggest single trading market in the world. By choice. Talk about cutting off your nose to spite your face.

We got the economic facts and fundamentals, without prejudice, from the likes of the IMF, Bank of England and Treasury.

But on the Leave side all we were told was not to worry because the financials will be sorted out. No meat on those bones. An economic Plan B? There wasn’t and isn’t one.

In the immediate aftermath of this stunning results declaration we begun to see the fall-out as London’s main FTSE 100 index nose-dived by nearly 8 per cent, wiping close to £100 billion of the value of shares.

Granted, it did pull back from that plunge after the Bank of England pledged to intervene to help shore up the markets, with governor Mark Carney offering to provide £250 billion to support the markets.

The value of the pound in our pockets also slumped to 30-year lows against other currencies, notably the dollar but also down against the euro, which will make your trip to France for the football or for your summer break to the Mediterranean much, much dearer.

The UK’s vote to leave the European Union is enormously significant – negative initially – for global business and for the island of Ireland.

Yes, the positive relationship that already exists between Northern Ireland and the Republic – each is the other’s biggest single market for goods and services – will remain in the short term.

But who knows how this will change when the exit negotiations begin in earnest?

Positives? Well, while no-one is able to predict exactly what will happen in the coming weeks and months, and there’ll be volatility and uncertainty in the markets, they will most likely recover (as historically they always have from each and every shock event that has led to a sharp downturn).

Those who’ll still be in political power once the dust settles will have their work cut out as they discuss trade deals, regulation around movement of both goods and people; potential repatriation from within and back to the EU… the list goes on.

We’ve just taken an incredible leap of faith over the edge. Does anybody know where I can buy a decent parachute?