at the centre of the irish pharmaceuticals industry and has a vibrant it sector, as well as having significant indigenous business and tourism sectors. given its diversified economic structure, it is likely that the outlook for the region will be subject to the same risk factors as for the rest of the country. external risk factors looking ahead, the central forecast is for economic activity to continue to grow at a healthy pace, with the main impetus to growth expected to come from domestic factors. however, the outlook is characterised by uncertainty about the external environment such that risks to economic forecasts are to the downside. one obvious risk factor relates to brexit. looking at the wider international picture, given the strong presence of multinationals in the economy, there are also risks related to the potential for changes to broader international taxation and trade arrangements. 1 / 4 bis central bankers'speeches both in the short term and the longer term, the economic impact of brexit on ireland is set to be negative. reflecting this, the central bank revised down its economic forecasts in the wake of the uk referendum. to date, in the absence of any weakening in the uk economy, the impact of brexit has mainly been experienced through the sizeable depreciation of sterling against the euro. in addition, however, those sectors with a high dependency on exports to the uk remain exposed to any future adverse uk economic developments and also the threat of new barriers to trade. even for those parts of the economy not directly dependent on the uk market, there are potential indirect effects via competition from uk imports, supply - chain linkages and increased crossborder shopping. while exporters selling to the uk are most immediately affected, there are additional channels by which shifts in the sterling - euro exchange rate affects the economy. first, in many domestic sectors, the market share of domestic firms will be affected by import competition from the uk. second, many domestically - orientated firms are suppliers to exporters or rely on employees in exporting firms as customers. third, sterling depreciation is associated with an increase in cross - border shopping, including a greater volume of online purchases from uk websites. while these are adverse forces, it is also important to point out that a weaker sterling may benefit some firms that rely on imported inputs from the uk and that real income gains to households due to cheaper imports from the uk may in part be recycled into higher spending on domestically - produced goods and services. over the longer term, irish firms will have to

may emerge in the consultation. we want to shorten the period of uncertainty as much as possible. accordingly, after making any appropriate refinements ( for example, in relation to first time buyers, and to the potential future use of private mortgage insurance as floated in the consultation paper ), we will move quickly to confirm the parameters of the standing regime. almost all of the discussions that i have participated in at this committee over the past few years have naturally focused on the banks, but of course this is only one element of the central bank ’ s mandate and it is worth reminding that almost 9 out of 10 staff of the central bank are actually engaged in numerous tasks other than the prudential supervision of banks. ( there are, of course, other aspects of banking oversight that staff deals with, such as the consumer protection and conduct of business aspects of bank regulation ). indeed, the microprudential banking supervisory decision making now largely passes under the control of the eu single supervisory mechanism ( ssm ), which came into operation on november 4. the ssm does not, however, mean less work for us, but rather more work, inasmuch as the procedures of the ssm require a further expansion of our bank supervisory staff as well as a reorganisation of their function. indeed, after three years during which staffing levels have not risen, the central bank now needs to increase staff numbers again, not just because of ssm, but also because of the additional complexity of new international regulations covering non - bank financial services ( which form the heart of the ifsc ), new rules on bank resolution and other new mandates. ( much of the costs here are recovered from the industry ; indeed all regulatory costs could be so recovered, instead of having the effect of eating into the central bank ’ s surplus income to be transferred to the exchequer ; and the central bank has suggested this to successive governments. ) having already absorbed a sizable increase in staffing during 2010 – 11, we are currently engaged in an extensive review of our internal organisation to ensure the conditions for steady improvements in the effectiveness of our work, which relates to essential matters which, especially when they work well, are not obviously visible to the general public. the review is examining a range of issues including internal structures, career paths and internal processes. i expect significant beneficial changes to both organisational structures and practices within the central bank as a result of the review. our effectiveness will be enhanced by our carefully designed and efficient headquarters building at