Will Brexit hit the Liberties?

Next to a wide selection of beer taps hang framed photographs from Dublin’s past. Most of them in black and white with the the oldest ones go back to the sixties. While the barman is pouring a pint, tourists and locals alike are chatting at the bar.

We’re in McCann’s Bar, an old pub on James’s street in the heart of the Liberties. Far from London and Brussels, far from dancing UK Prime Ministers and European bureaucrats, yet, the Brexit negotiations could end up affecting this pub and other businesses throughout Ireland.

“There’s a big overall effect that comes from the fact that Brexit will affect the Irish economy as a whole. This will affect all Irish businesses more or less equally. We don’t know by how much, but the projections are that somewhere between two and seven percent of GDP growth will be lost,” says Assistant Professor in Economics at Trinity College, Marvin Suesse.

Ireland and the UK are heavily intertwined in trade, labour and investments, Suesse explains. When Brexit takes effect, it will make trading and investments harder and more expensive, which will hit the Irish economy. This would mean falling demand in Ireland and a weakening of business income.

According to Suesse, it is “not unimaginable” that some businesses in the Liberties would have to close. “It depends on the current performance of the business. A business that is doing well at the moment will have reserves to whether a shock, but for businesses that are just scraping by at the moment it may have severe consequences.”

It also depends on how the Brexit negotiations are going to turn out. The worst-case scenario being that Britain and the EU don’t strike a trade deal by the end of the year.

If Brexit happens without a deal, the trade between Britain and Ireland will be governed by world trade regulations. This will lead to tariffs that tend to be relatively high. The best-case scenario for Irish businesses would be a deal that stays as close as possible to the existing situation. But according to Marvin Suesse there’s no scenario where Brexit won’t have an impact, because no matter what, the freedom of movement and labor will be weakened.

McCanns Pub. Photo credit: Mads Thorup Thomsen

“This is one of the core demands of the Brexiteers, that Britain needs control on migration. Theresa May is under great pressure from both Brexit hardliners within her own party and to some extend the DUP,” says Suesse.

In McCann’s Bar in the Liberties, there isn’t a lot of trust for politicians. Barman Alan McCann doesn’t think highly of politicians and regards them as being “full of false promises.” “I don’t think the English politicians think about Ireland. They should definitely think more about it,” says McCann.

For the last two years McCann’s Bar has been owned by the nearby Pearse Lyons Whiskey Distillery, but it used to be owned by the McCann family. Before that its name was Ryan’s and before that it was called Hannan’s. Alan McCann reckons there has been a bar on this location for over one hundred years, a record which is now being threatened by Brexit.

McCann himself has been at the bar for 13 years, and he knows from experience how the Irish economy can affect his pub. He explains that the best business years were from 2005 to 2012. “Then the recession hit. Today lots more are staying at home to save money. So many pubs are closing down. There are three pubs left in this street. There were 11 or 12 at one stage,” he says.

There are other, more specific ways Brexit can hit Irish businesses, Suesse explains. “Businesses that are currently exporting to the UK will have greater difficulty doing so. Their product may become more expensive in Britain and they might be priced out of the market,” says Suesse. This will mostly affect big businesses though as most exporting firms tend to be bigger. For small local shops importing is far more important, because even though most small businesses don’t directly buy products from across the Irish Sea, many of their products are still sourced from the UK.

With regards to this issue, McCann’s is in luck as none of the pub’s suppliers have any significant link to the UK. And even though McCann agrees that Brexit could affect the pub, he generally has a positive outlook on the Irish economy and the future of his business.

“There’s no point to worry. If it happens it happens,” says McCann. Brexit won’t be keeping him up at night.