In the immediate aftermath of the UK’s decision to part ways with the EU, there has been no shortage of comment or opinion on the consequences of Brexit for Ireland, its people and the various sectors of the economy that have a trading relationship with the UK. Despite all of the noise, the unvarnished truth of the present situation is that nobody can credibly provide a definitive assessment of how the separation process between the EU and the UK will actually proceed, not least those who advocated a Brexit.

What I can authoritatively provide as Minister are some clear facts as to our present state of readiness within the Department of Agriculture Food and the Marine for what lies ahead. Firstly, it is important to note that the UK remains a fully active member of the EU today, and will likely remain so for at least the next two years. Therefore, our trading relationship is not altered in any way until the negotiation process which will dictate the terms and conditions of the UK’s departure are completed. It is still unclear as of this time as to when this process will even commence let alone finish. Secondly, as the Taoiseach clearly set out at this week’s European Council meeting, our national position will be to ensure that our particular national interests are fully respected as we prepare to enter these negotiations.

We have engaged in detailed contingency planning for the possibility of this result. We have identified the key challenges we will face and we have published a summary of the key actions we will take to address the contingencies arising from the UK’s decision. The most immediate concerns for agri-food exporters centre on exchange rates. In that regard, the Central Bank of Ireland have pre-established contingency plans to deal with market volatility surrounding the referendum result. The bank will engage with the Department of Finance and individual financial institutions regarding potential risks. Actions by ECB and other global actors will be monitored closely. In addition, I have asked Bord Bia to provide practical guidance to SMEs to assist them in dealing with marketing challenges arising in the short term.

Potential impacts

The main areas in which potential impacts are foreseen pertain to trade relations, certification, tariffs, labelling and standards. Preferential agreements already negotiated with third countries, particularly those dating back to UK accession, could require adjustment to take account of UK withdrawal. Freedom of the UK to negotiate trade agreements with third countries could present a competitiveness challenge for traditional suppliers such as Ireland. Over time, a differing approach by the UK to the common regulations and standards currently applied could create issues and require the conclusion of mutual recognition arrangements. Origin labelling could become an issue in terms of additional costs, possible disruption of supply patterns and consumer preference. But all of these identified challenges are all hypothetical, and largely dependent on whatever arrangement is put in place following what is inevitably going to be a testing negotiation period.

Knowing where the potential pitfalls lie is a good starting point in terms of developing solutions to counter these challenges. As part of our overall contingency planning, I have established a dedicated unit in my Department to work on all of these issues, and I have already convened a consultative committee of stakeholders who will ensure a full exchange of information as the negotiations proceed.

Two key points

Two key points are worth considering in conclusion. Firstly, we exported almost €5.1bn worth of agricultural products to the UK in 2015. This included almost €970m in dairy products and more than €1.1bn in beef products. However, Ireland also imported €3.8bn worth of food exports from the UK last year. We are their largest trading partner when it comes to food. Therefore, they have a vested interest in ensuring that whatever arrangement ensues after the negotiating process is mutually beneficial.

Finally, it is no accident that Ireland’s agri food sector is Ireland’s largest indigenous industry, contributing €26bn in turnover and 7.6% of GDP. In 2015, it accounted for around 8.4% of total employment, and has achieved growth figures of over 50% since 2009. It is because we have the brightest and best giving their all to drive the sector forward. From inside the farm gate to those promoting our products on foreign shores, we have the most innovative, passionate and resourceful people battling for our sector, and I am glad to have them in my corner as we prepare for the challenges ahead.

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