PLENTY of questions remain over the future of Britain’s trading relationship with Ireland, despite the UK government declaring its wish for a “frictionless” border post-Brexit.
If UK negotiators have their way, small traders crossing Northern Ireland’s border with the Republic will qualify for exemptions from customs tariffs on the basis 80% of North to South trade is “in effect, examples of local trade in local markets”.
In a position paper, the British government says that instead of bringing back border posts, a mix of technology and physical checks would monitor the compliance of larger firms engaged in international trade.
However, Labour says the vision of a “CGI, virtual reality border is nonsense… a pipe dream”.
Katie Daughen, head of Brexit research for the British Irish Chamber of Commerce, says: “Looking towards technological solutions represents a positive step but there are still questions about whether this is achievable.”
She says uncertainty remains and that any failure to create the frictionless border would have serious implications.
“On the island of Ireland, certain goods might cross the border a couple of times and it’s the impact in terms of paperwork, and delays and tariffs [that are of concern],” says Daughen, adding that progress in developing an all-Ireland economy in areas such as tourism or energy could be undone.
The UK wants the EU to recognise the “need to protect everyday movement of goods; and the integrated nature of the agri-food industry”. But while all parties involved publicly reject the idea of a “hard border”, the BBC quoted a British official saying that if no agreement was reached, EU rules would compel the Irish government to re-introduce border posts.
Daughen says: “30,000 people cross the border every day for work so what lies ahead if you’re from Dundalk and work in Newry, and vice-versa? There are social implications of delays crossing the border if you need to collect children from childcare, for example.”
UK ministers are also seeking to avoid the introduction of agricultural or food safety checks by ensuring “regulatory equivalence” with the EU. But it’s unclear how this sits with the desire to strike trade deals with countries that would not comply with European regulations, such as the US.
The Border Communities Against Brexit campaign group says the “deeply flawed” proposals “in no way address fundamental issues about trade”.
“No border would exist in Ireland but all products going across the border into the EU would be made and certified to EU standards to prevent customs checks,” reads a post on the group’s Facebook page.
“Why then would you leave the EU?” it asks, pointing out that Northern Irish businesses would have to maintain EU standards without the current access to funding from Brussels.
Daughen says this is of particular concern to agri-food producers on both sides of the border and that a failure to strike a deal, resulting in the imposition of WTO tariffs, would have a significant effect.
“Within the supply chains that exist and extend across the EU, importers are going to be at risk. They aren’t getting as much attention as exporters, who create GDP for a country,” she says.
Many businesses are looking into establishing operations either side of the border in order to secure their market and suppliers.
Simon Haigh, who runs the Dublin office of business valuation consultancy Brand Finance, says: “We’re aware that more than 1,000 UK businesses have registered a business entity in Ireland, from sectors across the board including insurance, marketing and engineering.
“I don’t see any that are moving lock, stock and barrel but they are hedging their bets. Companies want to keep a foothold in the EU, given the UK could suffer from not being within the union, and the Irish economy is one of the fastest-growing in Europe.”
The London-based company, which helps companies get their brand value recognised on balance sheets, has offices in more than 20 countries.
Haigh set up the Irish arm six months ago.
“We’ve gained out of Brexit because we sensed an opportunity to set up in the Irish market, which is doing really well,” he says. However, he says others are not so confident of the results.
“Down the line, I think Brexit is going to have a deep-rooted effect on confidence in terms of SMEs attracting the best quality workers.”
As a partner in a company that owns pubs in both Kilkenny and Liverpool, PJ Lanigan is experiencing the Brexit effect from both sides of the Irish Sea.
It’s been bad news at his Kilkenny pub, with the number of English visitors joining the ghost and hurling tours he runs taking a nosedive after the weakening of Sterling.
“It’s a worry that it looks like the pound will be down for a long time,” he admits.
On the flip side, he’s in the process of developing hotel accommodation for up to 50 people above Lanigan’s, the bar he opened in the heart of Liverpool 18 months ago.
“For my Liverpool business it’s great because we’re getting lots of people here from Ireland,” he adds.
Lanigans hosts monthly social evenings for the Liverpool chapter of the British-Irish Trading Alliance. Its members seemed less concerned about the effects of Brexit than their Dublin counterparts.
“Maybe I won’t get as much work,” says electrician Liam O’Neill, “but then one of the complaints in trades was that people had come from Eastern Europe and it had forced prices down across the board.”
The chapter’s chairwoman, Pam Moore, helps small businesses access growth funding from a range of sources in her role as a director of T4C consultancy. She’s not too concerned about losing access to streams such as the European Regional Development Fund (ERDF) stream of the European Structural and Investment Funds (ESIF).
“At the moment there’s not a worry because the funding that’s already in place is still available,” she says. “And every few years funding morphs into something slightly different anyway. There will still be funding there for companies, it will just be in a different guise.”
Wirral-based marketing specialist Agnes Fitzgerald, who’s originally from County Limerick, is in the process of setting up a membership-based networking group for the Irish diaspora and those who trade with Ireland.
“It’s particularly important to have this sort of network with Brexit coming,” she said. “There’s going to be so much upheaval and nobody knows what the outcome will be.
“People have worked so hard to bring about good relations and both Belfast and Dublin have been booming. If we don’t handle Brexit properly we could go back 50 years, so it’s going to come down to individual people in both countries and how they communicate and work together and trade.”