Government departments have been told to work out what resources or legislation they will need to protect themselves in the event of a hard Brexit.
Officials at the Department of Foreign Affairs are understood to be stepping up preparations for a potential disorderly exit from the European Union by Britain.
Sources said there was small chance that the UK government would allow such a situation to develop and it was necessary for the Irish government to develop contingencies.
There are fears that Ireland’s agriculture sector could be hit by tariffs of up to 60 per cent, Irish aircraft may not be able to land in the UK and up 40,000 jobs could be lost in the event of a hard Brexit.
Border controls would also have to be introduced and the economic growth of the country would be slowed down significantly.
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There would be delays at the ports and there would be a significant impact on other sectors such as in the fisheries sector, as about half of the Irish catch comes from UK waters, which would be off limits, it is feared.
Concerned about these potential impacts, senior civil servants in the department have begun preparations.
All government departments have been asked to specify in “ballpark figures” what resources they need, what domestic legislation could be required and what policies may lessen the damage.
David Davis, the UK’s Brexit secretary, said yesterday that he was confident a political agreement could be reached at a European Council meeting in March that would secure a transition period after the country leaves the bloc in 2019 to limit disruption.
“Our immediate goal is to reach an agreement on the implementation period,” Mr Davis said. “And because our objectives are largely the same, I am confident that political agreement can be reached at the March European Council.”
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The EU is willing to be flexible on the duration and other terms of a transition period, which could include letting London sign trade deals, according to a document due to be formally endorsed by EU ministers on Monday.
“Of course, maintaining access to each other’s markets on current terms means we will replicate the effects of the EU customs union during the implementation period,” Mr Davis said last night.
“But participating in a customs union should not preclude us from formally negotiating, or indeed signing, trade agreements,” he said, while adding that any such deals could not enter into force until the transition period had ended.