Brexit: Opportunities and challenges for business Conor Lambe, Danske Bank Economist @ConorLambe

Outline 1 The challenges that Brexit will bring 2 Opportunities that exist in the short-term 3 Longer-term opportunities for business 4 Brexit and Northern Ireland

The challenges that Brexit will bring

The challenges that Brexit will bring The Brexit negotiations will be extremely complex and external events could have an impact Source: Danske Bank analysis, The Financial Times

The challenges that Brexit will bring The Government have confirmed that the UK will leave the EU Single Market, it’s largest export partner Source: Danske Bank analysis, ONS

Lack of experience of trade negotiations The challenges that Brexit will bring Practically, there are a number of things that will prove challenging during the negotiations Exit bill, trade, rights of nationals, budgetary contributions etc. Lot to negotiate Lack of experience of trade negotiations Dept. of International Trade is relatively new in the UK Practical challenges How can the Gov’t engage all the parties that should have a role? Many stakeholders It is expected that a deal would need to be in place by Oct 2018 Not a lot of time

Opportunities that exist in the short-term

Opportunities that exist in the short-term The depreciation of the pound has made UK exports more competitive in international markets Source: ONS

Opportunities that exist in the short-term Professional services firms have outperformed their peer group and the whole services industry since the referendum Source: ONS

Longer-term opportunities for business

Longer-term opportunities for business The Government hopes to agree a number of new trade deals once the UK leaves the European Union Source: Danske Bank analysis, ONS

Longer-term opportunities for business Leaving the EU could give the UK more control over regulations that impact UK-based businesses £4.7bn a year The UK Renewable Energy Strategy £2.1bn a year £4.6bn a year The Temporary Agency Workers Directive The CRD IV package Top 5 costliest EU-derived regulations in the UK The EU Climate and Energy Package The Working Time Directive £3.4bn a year £4.2bn a year Source: Open Europe Note: Figures are in 2014 prices

Longer-term opportunities for business The Government are likely to make a smaller financial contribution to the EU post Brexit Source: HM Treasury

Brexit and Northern Ireland

Prospects for the Northern Ireland economy In the short-term, private services are forecast to remain as the primary contributors to NI’s economic growth in 2017… Sector contributions to GVA growth in 2017 Source: Danske Bank Quarterly Sectoral Forecasts 2017 Q1

Brexit and longer-term priorities for the NI economy …but issues around trade and the border with RoI are the main impact areas when looking longer-term 55% of Northern Ireland’s total goods exports went to the EU in 2016 Relevance for Northern Ireland 31% of Northern Ireland’s total goods exports went to the Republic of Ireland last year Businesses and policymakers in Northern Ireland must stand ready to grasp the opportunities that will come from Westminster’s renewed focus on international trade 1 2 3 Access to EU markets Border with RoI Expand into global markets

Thank you Conor Lambe Economist at Danske Bank conor.lambe@danskebank.co.uk Twitter: @ConorLambe LinkedIn: Conor Lambe Reports available at www.danskebank.co.uk/economy This presentation is for information purposes only, is not intended as an offer or solicitation, nor is it the intention of the Bank to create legal relations on the basis of the information contained in it. So far as the law or regulation allow, we disclaim any warranty or representation as to the accuracy or reliability of the information and statements in this presentation. We will not be liable for any loss or damage suffered from relying on this report. This presentation does not purport to contain all relevant information. Recipients should not rely on its contents but should make their own assessment and seek professional advice relevant to their circumstances. Danske Bank is a trading name of Northern Bank Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in Northern Ireland (registered number R568). Registered Office: Donegall Square West Belfast BT1 6JS. Northern Bank Limited is a member of the Danske Bank Group. © Copyright Danske Bank. 2017. All rights reserved. The contents of this presentation, ether in whole or in part, may not be reproduced, stored or transmitted without prior written permission from Danske Bank.