Dublin (AFP)

Ireland, a country highly exposed in the event of Brexit without agreement, presented Tuesday a 2020 budget to absorb the impact of this dreaded scenario, with more than 1 billion euros of expenditure to support the activity.

"Brexit is the most urgent and immediate risk for our economy" and an exit from the European Union without agreement "would be very difficult," Finance Minister Paschal Donohoe said in an address to Parliament.

"I am announcing a total expenditure of 1.2 billion euros - excluding European aid - to meet Brexit," he said.

"This is an unprecedented budget (...) but these are unprecedented times," said the minister. He said that "the prospects for Brexit are now moving towards an exit without agreement," which does not mean that this scenario is "inevitable," he said.

He said that some € 650 million would be injected to help key sectors, such as agriculture or tourism, to limit the negative effects of leaving the EU without a net. There will be 85 million for cattle farmers and 14 million for fishermen.

The Central Bank has warned that a Brexit without an agreement could kill about a third of farms because of a potential steep rise in customs duties: those on meat would reach almost 50%.

"We will face the challenges of a Brexit without agreement in a position of strength" and "we are ready," insisted Donohoe.

"This year, we have eliminated our deficits and expect a budget surplus of 2%" of gross domestic product (GDP), said the minister. In case of no deal, "we will continue to increase this surplus".

- Dead end -

British Prime Minister Boris Johnson has promised a Brexit "no matter what" on October 31, with or without agreement with the EU, and negotiations with Brussels are deadlocked three weeks before the deadline.

Brexit without agreement, which would restore physical boundaries between Ireland, a member of the EU, and Northern Ireland, a province that is part of the United Kingdom, could deprive 55,000 Irish laborers and plunge the country's GDP by 6%, according to government data.

A huge shock since last year, the country had recorded a spectacular growth of 8.2%. This year, the government is expecting a 5.5% increase in gross domestic product (GDP).

Politically, the return of the borders would also threaten peace with Northern Ireland after decades of bloody conflict.

If Ireland is particularly exposed, the UK should also feel the earthquake of a Brexit without agreement: according to the think tank Institute for Fiscal Studies (IFS), it would lead to an explosion of the public deficit and propel the debt at over 90% of GDP, for the first time since the 1960s.

Boris Johnson's government is also considering business support measures, including a one-year cut in import tariffs, which could apply to 88 percent of them, to limit price increases. .

Beyond Brexit, the second major axis of the 2020 budget presented by Donohoe is the fight against global warming, presented as "the challenge that will define our generation".

The Co2 tax will rise from 20 euros today to 80 euros per ton by 2030, which should generate an additional 6 billion euros.

The minister has also planned millions of euros of investment in greener transport, including urban bike lanes.

© 2019 AFP