The negative impact on Ireland’s small business sector from ongoing Brexit uncertainty is rapidly rising with more than a third of SMEs saying they have either cancelled or postponed investment plans.
The worsening SME sentiment coincides with one of the main business lobby groups in the UK suggesting the chances of a no-deal Brexit have increased.
As much as 35% of SMEs in the Republic and 40% of those in the North have halted investment plans due to Brexit in the past three months, according to research from AIB. The survey also shows that over half of SMEs – across the island – have yet to begin Brexit planning.
Furthermore, 32% of SMEs in the Republic said Brexit is now starting to impact on their business. That figure is up from 25% just three months ago.
“Concerns continue to grow, from already high levels, about the impact on business in the future of Brexit and its wider economic effects,” said AIB’s chief economist Oliver Mangan.
“This is particularly concerning as Brexit, whether hard or soft, will inevitably result in the need for increased working capital to manage businesses cost pressures or possible price inflation should Brexit eventually result in the UK leaving the EU customs union,” said AIB’s head of business banking Catherine Moroney.
Meanwhile, director general of the Confederation of British Industry Carolyn Fairbairn has warned Brexit has entered an “emergency zone” with the chance of Britain crashing out of the EU with no trade deal agreed increasing.