May looks to Corbyn as Brexit moves towards endgame

Business Week: also in the news were unemployment, house prices, hotels and media

UK prime minister Theresa May did the unthinkable this week, and invited Labour leader Jeremy Corbyn into the inner circle.

Fed up after three resounding defeats of her Brexit deal in the House of Commons, May infuriated Tories by reaching across party lines and offering to work with Corbyn to find a common approach as to how the UK might leave the EU in an orderly fashion.

The move, which followed a seven-hour cabinet meeting, was part of a broader pivot towards a potentially softer Brexit as May indicated she might be willing to budge on some of her red lines in terms of the future relationship with the EU.

The two leaders agreed a “programme of work”, and appointed negotiating teams, before MPs approved a bill obliging May to seek a lengthy delay to Brexit rather than leave the EU without a deal at the end of next week.


May then wrote to European Council president Donald Tusk asking to delay Brexit until June 30th to give divided British politicians time to agree a withdrawal deal. If an agreement can be reached sooner, she proposed the extension be ended early.

While there was little optimism on that despite the olive branch to Corbyn, there was a glimmer of hope when – lo and behold – DUP leader Arlene Foster signalled the party might be willing to sign up to a softer Brexit if it ruled out the backstop.

Meanwhile, support from Europe for Ireland remained unwavering. German chancellor Angela Merkel met Taoiseach Leo Varadkar in Dublin, where she made no demands about the Border in the event of a no-deal Brexit.

Earlier, French president Emmanuel Macron said: “We will never abandon Ireland and the Irish, no matter what happens. This solidarity is the very meaning of the European project.”

All that being said, in the event of a no-deal Brexit, the European single market will have to be protected, and EU chief Brexit negotiator Michel Barnier said extensive checks on goods and animals crossing the Border would be necessary. The only question is where.

Varadkar suggested many Border checks and procedures could be done remotely, but said animal checks could only be done physically by vets. He said these checks could take place at ports in the North but this would require co-operation from the British.

All the while, the latest doomsday scenario from the Central Bank predicted that sterling will drop in value to near parity with the euro in the event of a no-deal Brexit, heaping further pain on Irish exporters.

All go for Dublin as economy motors

As Brexit moves towards endgame, the Government can at least be grateful that – even if it all does go belly up – most of the indicators suggest the Irish economy is in pretty resilient shape at the moment.

The latest figures from the Central Statistics Office (CSO) showed unemployment fell to another 10-year low of 5.4 per cent last month, with the seasonally adjusted number down to 131,100 in March, which was a reduction of 3,400 on the previous month.

That is nearly three percentage points below the euro zone average. On current trends unemployment is expected to fall below 5 per cent next year, which is equated to full employment here.

Elsewhere, a report by the International Monetary Fund found that Dublin has experienced one of the highest rates of property price inflation of any city in the world over the past five years.

In a special report on house prices and financial stability, the Washington-based fund ranked the capital first out of 22 cities in advanced economies on the basis of annual real house price growth since 2013.

The capital is also ahead of the pack when it comes to average household disposable income. It is nearly a fifth higher than the national average, according to the CSO. Figures for 2016 show an average disposable income per person of €24,431.

This was 18.5 per cent higher than the State average of €20,638, and 41 per cent higher than the Border region, which had the lowest per-capita disposable income of €17,370.

Meanwhile, the latest Exchequer returns showed the Government spent more than €15 billion in the first three months of the year, which was almost €1 billion more than it collected in taxes and other revenue.

Separately, as the health of the economy contributing to an influx of business tourists, Fáilte Ireland said it was in talks to assist property developers interested in building large-scale hotels in Dublin of up to 1,000 bedrooms.

Paul Kelly, the authority’s chief executive, says the lack of hotels of such scale within Dublin city was costing the industry “tens of millions of euro” in lost international conferencing business.

While they will be nothing on that scale, planning permission was secured this week for new hotels on Dawson Street (117 bedrooms) and the site of the old Howl at the Moon venue on Lower Mount Street in Dublin (52 bedrooms).

Troubling times for newspapers

These are tough times for the newspaper industry, but there was some respite this week for the embattled giant Independent News and Media (INM) when news of a potential buyer sent its share price soaring more than 30 per cent.

The approach, from an unnamed body, came hot on the heels of the company’s annual results last week, which showed falls in advertising and circulation led to a 15.4 per cent drop in its pre-tax profits for 2018.

Despite the interest we know nothing of the intentions of billionaires Denis O’Brien and Dermot Desmond, the company’s two major shareholders, who control about 45 per cent of INM between them.

Elsewhere, DMG Media Ireland, the publisher of the Irish Daily Mail and the Mail on Sunday told about a dozen staff their jobs were at risk  after the company did not receive the voluntary redundancy applications it was seeking.

The news group, which employs 156 staff in Dublin, opened applications for about 35 voluntary redundancies early last month. It said the redundancies were triggered by falling newspaper sales and declining advertising revenue.

The latest figures show the Irish Daily Mail’s print circulation in the Republic fell by nearly 20 per cent to 29,654 in the second half of 2018.