Ireland is set to be centre-stage in Brexit talks after the EU made it a priority to avoid the formation of a hard border between the UK and Ireland, but a policy expert has warned an Irish exit from the EU might be necessary to protect the country's economy.
In an analysis for the Policy Exchange, Ray Bassett, a former Irish ambassador, has said Ireland should opt out of its relationship with the EU and remain in a customs union with the UK.
Bassett said: "As the balance of advantage between the two options is weighed up, there is only one conclusion, namely that Ireland may be better off in the longer run exiting the EU.
"The chances of obtaining a satisfactory outcome to the present Brexit negotiations for Ireland are faint."
He said that it was particularly damaging that the EU was pushing for the future relationship between Ireland and Britain to maintain the "integrity of the Union's legal order", which includes the customs union.
This would mean there would be "no open border" between Ireland and the UK if the UK chooses to leave the customs union.
"Where the EU customs union meets a third country, there is inevitably considerable bureaucracy which costs time and money," he said.
Given that Irish trade with the UK is worth €1.2bn per week, Brexit risks "massively damaging the economic relationship" between the two countries under the current EU customs system, he said. Industries that are at particular risk include Ireland's fishing industry and its thoroughbred horse industry.
"Therefore, given the circumstances, Irexit has to be the option for Ireland in a hard Brexit situation," Bassett said.
"In any negotiation, there must be a bottom line and if breached, the option of walking away must always be there. Irexit is a definite option for Ireland, should the EU and the UK not arrive at a satisfactory deal."