Irish business group Ibec has warned that some €400m in State and EU contributions will be required to protect Irish businesses from the fallout of Brexit.

The group also states that, "the surprise UK election result offered a fresh opportunity for the UK to shift its divisive hard-Brexit trajectory."

The 'Brexit: Challenges with solutions' report has five main recommendations:

• Trade: It believes it is in everyone's interest for the UK to remain in the EU customs union - but if that is not the case, simplified customs procedures will be needed. It adds that an "agreement on trade and customs on the island of Ireland should be framed in the first phase of talks."
• Customs: It warns that cooperation between customs authorities is vital and that "new pre-clearance procedures and mutual recognition." It adds that "businesses will need significant support to train staff in new customs procedures and upgrade IT systems, while customs authorities will need additional resources to address Brexit pressures."
• Single Market and regulation: It calls for minimal divergence in policies between the EU and the UK. It also warns that, "Any new EU-UK FTA must include comprehensive, legally enforceable commitments to fair competition."
• Common Travel Area and all island economy: It believes that "the Ireland-UK Common Travel Area should be maintained and the need to support the Northern Ireland Peace Process must inform every decision."
• Alleviation measures: Ibec states that, "A temporary EU state aid framework is needed to support companies through any adjustment period and the European Globalisation Adjustment Fund should be reformed to ensure it can address the economic fall out of Brexit. Funds amounting to 5% of the value of current annual export sales to the UK will be needed annually from domestic and EU sources to help Irish companies innovate, diversify into new markets, train staff and invest for the future."

Commenting on the report,  Ibec CEO Danny McCoy said, "The economic risks and political challenges of Brexit are crystallising in the UK. Living standards are being squeezed and investment is being deferred or going elsewhere in Europe. With the Brexit clock ticking, the UK must quickly reassess and redefine its Brexit approach.

"The concerns of business in the UK, Ireland and across Europe must inform the UK approach and the EU response. The Irish economy is powering ahead and is well positioned to respond to any Brexit upheaval, but the risks are very real. Brexit is a threat to our living standards and our economic ambition. There can be no complacency."

The UK's Brexit Secretary David Davis and the EU's chief negotiator Michel Barnier will hold talks in Brussels - with the Northern Ireland border set to feature on the agenda.