The intervention in the Brexit debate by the Confederation of British Industry (CBI) this week, coming out in support of Britain remaining in a customs union, is timely.
Carolyn Fairbairn, its director-general, says such a course of action could help to address some of the complex challenges, including how to manage the border with Northern Ireland.
The mobilisation of British business on this issue should come as no surprise. There is no reputable economic analysis that suggests anything other than the UK taking a significant economic hit if it turns its back on the EU trading bloc. Our close ties mean Ireland and Irish business are uniquely exposed to the fallout from such an outcome.
The idea that a UK free to negotiate unilaterally its own trade deals with the rest of the world will deliver an economic windfall is deeply misguided.
In fact, analysis by the London School of Economics presents a depressing alternative vista. The introduction of significant trade barriers between the UK and the EU could seriously disrupt existing trade flows, leading to a fall in UK household income of £1,700 annually. Even a relatively benign outcome to talks could result in annual household income dropping by £850.
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The UK government, however, thinks differently. In the House of Commons this week, Theresa May again reiterated the government position that the UK was leaving the customs union and going it alone.
To rational observers from outside the UK, Brexit policy is being driven not by the need to support growth and job creation but by a short-sighted political dogma, and one that has been emboldened since the referendum outcome. Any dilution of this hardline position is portrayed as weakness. Any suggestion of a rethink is regarded as treacherous.
This is not a constructive backdrop to these most serious of negotiations. It is vital that the real-world perspective of business is given much greater credence in the debate.
That is the message I brought on behalf of Irish business to the House of Commons committee on exiting the EU yesterday. The committee was in Dublin for an Irish view on the progress of Brexit negotiations. It was a message that chimes with that delivered by the CBI.
The UK remaining in a customs union is overwhelmingly in our shared economic interests. It would help to offset many of the negative impacts of Brexit, protect existing trading relationships and the functioning of complex international supply chains, and avoid the potential for hard default to punitive WTO tariffs. It would be the right decision for jobs, growth and investment.
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The UK government has not yet taken on board these concerns. However, as the effects of Brexit manifest themselves and as the consequences of different policy choices become clearer, the position may change. Over recent weeks the ground has already shifted. The starting point for the next phase of negotiations is based on the far-reaching and significant phase one agreement reached in December. We are not starting from scratch.
The deal includes important commitments on how to avoid a hard border on the island of Ireland. These now need to be captured in a robust legal form and must inform the talks on a transition deal and, importantly, on the future EU-UK relationship. There can be no backsliding.
Avoiding a hard border will involve not only a comprehensive deal on customs but also on wider regulatory alignment. Northern Ireland will need to stay close to the single market if we are to avoid checks at the border.
The December deal goes even further. The UK commitment to avoiding regulatory divergence between Britain and Northern Ireland means that a solution to the Irish issues is likely to have a significant bearing on the wider outcome of the talks. Even if it is not easy to discern exactly what that might entail right now.
Central to any outcome must be ensuring that close north-south and east-west co-operation enshrined in the Good Friday agreement is fully protected. We must not gloss over the lessons of the past.
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Before the establishment of the single market in the early 1990s, the Republic and Northern Ireland had a dysfunctional economic relationship. Today, however, shared EU membership, along with the peace settlement, has led to cross-border activity rising to EU norms. The clear, long-term commitment in the December deal to safeguard the functioning of the all-island economy is vital.
More immediately, the issue of transition arrangements after the UK departure are now on the table. Thankfully business concerns have finally been reflected in the proposals from both sides that a transition period should essentially mirror all existing single market and customs arrangements.
What we need now is for any arrangements to be agreed quickly and be of sufficient duration to allow business to fully adapt. They must also be flexible and responsive to the business needs that different scenarios may present.
A wide range of possible final outcomes still exists, ranging from relatively benign to costly and divisive. As we approach the crunch points in the phases of negotiations, it is vital that crucial pragmatic business concerns are brought to bear on the final outcome. That is what our counterparts in the CBI argued this week, and that is what Ibec and Irish business will continue to work vigorously to achieve.
While talks are likely to remain fractious, our shared interests lie in the closest possible relationship, informed by the need to support jobs, wages and living standards across Ireland, the UK and the EU now and long into the future.
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Danny McCoy is chief executive of Ibec, the employers’ group