Ireland will receive more than €1 billion from the EU’s Brexit Adjustment Fund, making it the biggest single beneficiary of the €4.24 billion fund, according to figures released on Wednesday (13 January).
The fund, agreed by leaders of the EU27 last summer, is designed to help businesses and communities cope with increased costs of trade and lost income now that the UK is outside the EU’s single market.
The new EU-UK trade pact, which came into force on 1 January, offers tariff- and quota-free trade in goods but the new customs regime at the border is likely to impose significant new financial and time costs on businesses on both sides of the Channel.
“We kept united during negotiations, we stay united in day after,” tweeted the EU’s Regional affairs commissioner Elisa Ferreira.
The €5 billion Brexit Adjustment Reserve will support countries, regions, sectors most impacted.
€4 billion will be paid in 2021 according to econ integration w/🇬🇧 & fishing in🇬🇧waters.
— Elisa Ferreira (@ElisaFerreiraEC) January 12, 2021
Budget Commissioner Johannes Hahn said the reserve fund had been “designed to provide swift and uncomplicated help, focusing on those EU member states most adversely affected by Brexit.”
Irish Taoiseach Micheál Martin told the country’s lawmakers that the funding was “much-needed”. The UK is still Ireland’s biggest trading partner in food products, while the loss of access to UK fishing waters will also cause an economic hit to Ireland.
Other major beneficiaries from the fund include the Netherlands, which will receive €757 million, Germany with €455 million, and France with €420 million.
According to the European Commission’s guidance, the Adjustment Fund is designed to provide ‘support to economic sectors, business and local communities, including those dependent on fishing activities in the UK waters’, to help reintegrate citizens returning from the UK, and to ensure that the new border and customs regimes operate properly.
The EU’s fishing sector is expected to be badly hit by the Trade and Cooperation agreement finalised by the EU and UK on Christmas Eve. Under the compromise reached by the two sides to unlock the most divisive element of the talks, the EU agreed to give up 25% of the value of fish quota caught by EU boats in UK waters over a five-and-a-half-year adjustment period.
For its part, the UK has set up a plethora of new funds and instruments to replace EU funding streams, particularly from the Common Agricultural Policy and cohesion and structural funds for poorer regions.
[Editing by Zoran Radosavljevic]