Ireland should give “serious consideration” to following Britain out of the EU, a right-leaning UK think tank said.

The Republic could opt to remain with the UK in a customs and free trade area, while negotiating as favourable as possible trade and investment terms with the remaining 26 member states, Policy Exchange added.

Former Taoiseach Enda Kenny firmly rejected any suggestion that Ireland should leave the EU, saying the foundation of Ireland's prosperity and the bedrock of its modern society was membership of the European Union.

But this report by the influential British research organisation said: “In the circumstances, Ireland must give serious consideration to other options, including Irexit.”

The document was drawn up by Ray Bassett, a former Irish diplomat and commentator.

It said Ireland faced a huge choice.

“Whatever the outcome of the Brexit negotiations, there will be a price to pay. For Ireland, there is really no upside to Brexit,” it said.

“The question to be raised is what price is Ireland willing to pay to stand in solidarity with the remaining 26 EU countries?

“If the Irish Government is willing to pay that price, will the Dail, and possibly the population in a referendum, be equally willing to do so?”

The report said:

Access to the Single Market need not be synonymous with full EU membership.

The EU is facing “huge problems” and its future direction is unlikely to be in Ireland's interests.

The DUP's central role in Brexit negotiations as part of its relationship with the Tories should facilitate strong cooperation across Ireland.

“Simply sitting on the sidelines and allowing the EU to negotiate for Ireland is essentially untenable.

“The first duty of the EU negotiators is to act on behalf of the European Union as an institution.

“This is prioritised in their guidelines, approved by the European Council.

“The type of deal that Ireland's interests requires, however, including free trade with the UK, is directly in contradiction with the Union negotiators mandate that anything relating to Ireland and her border which emerges from the Brexit negotiations, must 'maintain the integrity the Union's legal order', i.e., no exceptions to the customs union.”

In pictures: European parliament Brexit discussions Show all 12 1 /12 In pictures: European parliament Brexit discussions In pictures: European parliament Brexit discussions European commission member in charge of Brexit negotiations with Britain, French Michel Barnier listens at the President of the European Commission Jean-Claude Juncker speaking at the European Parliament in Strasbourg Getty Images In pictures: European parliament Brexit discussions Frank-Walter Steinmeier, President of the Federal Republic of Germany, delivers his speech at the European Parliament in Strasbourg EPA In pictures: European parliament Brexit discussions European Union's chief Brexit negotiator Guy Verhofstadt, President of the Group of the Alliance of Liberals and Democrats for Europe (ALDE), addresses the European Parliament during a debate on Brexit priorities and the upcomming talks on the UK's withdrawal from the EU Reuters In pictures: European parliament Brexit discussions Michel Barnier, European Chief Negotiator for Brexit reacts during a meeting at the European Parliament in Strasbourg EPA In pictures: European parliament Brexit discussions Member of the European Parliament and former leader of the anti-EU UK Independence Party (UKIP) Nigel Farage wears socks with Union Jack flag at the European Parliament in Strasbourg Getty Images In pictures: European parliament Brexit discussions Nigel Farage, United Kingdom Independence Party (UKIP) member and MEP, addresses the European Parliament during a debate on Brexit priorities and the upcoming talks on the UK's withdrawal from the EU Reuters In pictures: European parliament Brexit discussions European commission member in charge of Brexit negotiations with Britain, French Michel Barnier gestures during speeches at the European Parliament in Strasbourg Getty In pictures: European parliament Brexit discussions The President of the European Commission Jean-Claude Juncker (L) speaks with European commission member in charge of Brexit negotiations with Britain, French Michel Barnier at the European Parliament in Strasbourg Getty In pictures: European parliament Brexit discussions European Union's chief Brexit negotiator Guy Verhofstadt, President of the Group of the Alliance of Liberals and Democrats for Europe (ALDE), addresses the European Parliament during a debate on Brexit priorities and the upcomming talks on the UK's withdrawal from the EU Reuters In pictures: European parliament Brexit discussions Member of the European Parliament and former leader of the anti-EU UK Independence Party (UKIP) Nigel Farage gestures during speeches at the European Parliament in Strasbourg, eastern France, on April 5, 2017. The European Parliament will on April 5 lay down its "red lines" for negotiations over a Brexit deal, on which the assembly will have the final say in two years' time. / AFP PHOTO / Sebastien BozonSEBASTIEN BOZON/AFP/Getty Images Getty In pictures: European parliament Brexit discussions German president Frank-Walter Steinmeier delivers a speech during a plenary session at the European Parliament in Strasbourg Getty In pictures: European parliament Brexit discussions The European Parliament in Strasbourg, eastern France Getty Images

The consensus in Ireland favours remaining in the EU.

A recent poll suggested that 88 per cent of Irish people think Ireland should stay in, although that was commissioned by an NGO which works to develop links between the Republic and EU.