Ireland takes advantage of Brexit

The Irish government has bid to host two major European Union bodies that will be relocated from London post Brexit.

Dublin, Frankfurt and Paris, have emerged as top hotspots vied by organizations that are preparing to shift their bases from Britain.

Background

In June 2016, Britain narrowly voted to leave the EU. The country is currently negotiating with EU officials to draw a roadmap for its exit.

This has caused organizations (with EU ties) that are currently headquartered in London to look for alternatives.  Recently, Bank of America (BoA) announced that it will be setting up its EU headquarters in Dublin, making it the first Wall Street lender to do so. Barclays is mulling a move to Dublin as well. The Irish government has been bullish in attracting banks to the country and has welcomed the recent developments.

Frankfurt is also attracting a number of organizations. US investment bank Morgan Stanley has chosen Frankfurt as it base and companies like Daiwa, Sumitomo Mitsui and Nomura of Japan have expanded their Frankfurt offices.

Analysis

Ireland has made a bid to host European Banking Authority (EBA) and European Medicines Agency (EMA). The two companies employ just around 1,000 staff put together. However, their relocation has triggered a fierce race between many EU nations. Netherlands, Denmark and Germany have also reportedly placed bids. Currently, Frankfurt has been pegged as a favorite to get EBA.

The reason why multiple countries are vying for these agencies is due to the fact these bodies have a highly skilled workforce. The families of those employed will also come to these countries; as will the businesses they will bring along with them. A relocation would also result in 40,000 hotel stays for visitors in a year.

Ireland is hoping to beat the other nations by promising to be “least disruptive”. The Minister of State for Financial Services and Insurance Michael D'Arcy said, “The fact that the United Kingdom has decided to leave the European Union has resulted in significant disruption and uncertainty. For the EBA, its staff and their families, a move to Dublin is the least disruptive option. Our transport links to Europe, our culture, language and skilled multilingual education workforce make Dublin an attractive destination ahead of other potential locations.”

Assessment

Our assessment is that what may likely be Britain’s loss could be Ireland’s gain. Over the last six months, Ireland has aggressively tried to cash in on the advantages that Brexit has offered and in many ways, it has come on top.