Irish PM calls for Brexit transition deal, warns against punishing UK

(Fixes typo in first paragraph)

DUBLIN, Feb 15 (Reuters) - Ireland (Other OTC: IRLD - news) 's Prime Minister Enda Kenny warned European Union leaders on Wednesday that any talk of punishing Britain for leaving the bloc was deeply unwise and called for a transitional agreement to ease the damage likely to be caused by the split.

Ireland is widely considered the European Union economy most at risk from its key trading partner's decision to quit the bloc and Kenny said the government would seek the "closest possible" economic relationship between the EU and the UK.

"From my own contacts with other leaders, I believe that there will be significant support for that position at the European Council, provided it is based on a level playing field," Kenny said in a speech in Dublin.

"Whether in London, Brussels, or anywhere else, talk of punishment or of cliff edges is deeply unwise and can only be harmful to everybody in Europe," he said.

Several European leaders have said Britain should not be punished for its vote to leave the bloc, but some governments fear an attractive deal for Britain might lead others to follow suit.

Kenny also said the EU should secure "an appropriate period of transition, during which the full legal framework for that new relationship can be concluded."

Kenny said it was of "vital national interest" for Ireland to avoid the re-establishment of a physical border or customs controls between Northern Ireland and the Irish Republic.

And he said that Dublin would seek to represent the interests of Irish passport holders in Northern Ireland following the collapse of the power-sharing government there last month. "There is a very real danger that the absence of political leadership in Northern Ireland will lead to a retreat to partisan debate and an even greater marginalization of Northern Ireland’s concerns," he said. (Reporting by Conor Humphries; Editing by Dominic Evans)