The United Kingdom of Great Britain and Northern Ireland is leaving the EU; the United Kingdom of Great Britain and Northern Ireland is leaving the Customs Union; and the United Kingdom of Great Britain and Northern Ireland is leaving the Single Market.
Northern Ireland has not been designated some purgatorial relationship of neither being in or outside the EU but will be treated completely the same as every other component part of the UK.
Last Monday morning, Irish Taoiseach Leo Varadkar, before attending a planned press conference, had a ball at his toe and believed he was about to pull off the major coup of having secured Northern Ireland harmonised with the Republic of Ireland. This would have meant, in future, effectively never actually being outside of the EU – with a special status that would have hampered Northern Ireland going forward. But he didn’t get to kick that ball because before his moment of glory the ball was taken from him.
Despite yells of “we have an agreement” and that “not a jot” would be changed, four days later a new agreement emerged with vast sections rewritten and a different relationship established. Frankly, whatever efforts are made to characterise it, last week Leo Varadkar was done over by the EU, the UK and the DUP.
For weeks I and my colleagues had been warning Dublin that they had overstretched themselves and were attempting to use the Brexit negotiations to undermine Northern Ireland’s place in the UK. They were warned that the effort to make the border the centrepiece of the negotiations was misguided and that any discussion about the border was irrelevant until after the trade relationship part of the negotiations had been established.
Friday’s agreement effectively conceded that point and has relegated the completion of any negotiation about the border to be concluded at the end of the negotiations – once again, a very clear indication that Leo Varadkar has been done over.
However that was then and this is now. The fact is that the agreement reached on Friday, whilst imperfect, has now opened the Brexit negotiations into the important chapter of trade. It is here that potentially everyone becomes winners for real. The UK can establish the trading relationship it will have with the EU27, including a very special place for the Republic of Ireland in that market.
To be clear, we want the Republic of Ireland to be successful. It is just a pity that the feeling does not always appear to be reciprocated. It has always been my contention that it is at the point of a trade deal that our neighbour will actually come to its best place. I’ve never doubted the agility and ability of Irish businessmen to make the best out of that new trading relationship. Also, I believe given that the Republic needs the UK as one of its significant trading partners, it will see that it too will have more to gain by leaving the EU soon after Brexit is concluded.
Let’s face it, most of the Republic’s inward investment companies are UK- or USA-based. The vast majority of its trade is done with the English-speaking nations of the world, the Commonwealth countries who are keen to build a trading and political relationship with the Republic of Ireland. Let’s just hope that the political blindness of the current Dublin Government allows a genuine national conversation to develop about the potential of the Republic’s place outside the EU.
Imperfect as the agreement may be, we are now moving to the most important part of the negotiations. Goodwill can take us a long way, despite the threats of Mr Tusk that he will not make it easy. Failure to reach an overall agreement would mean ending up trading on WTO terms and whilst that poses significant challenges for some sectors such as agri-food exports for Northern Ireland, we would be in most cases isolated from the worst of the consequences as most of our export food market is the rest of the UK, making all our exports there zero-rated.
Our manufactured goods abroad would be subjected to trade tariffs of between 2% and 5%. However, in these circumstances the economy of the Republic would be crippled. Given that the UK is one of its significant export markets, it would be subjected to massive tariffs into its main market.
A Dail report has claimed that its GDP would fall by 4% and its fishing waters would have to accommodate all the fishing fleets of the EU. The Republic of Ireland’s largest fishing area i.e. the UK sea waters where it gets between 40% and 75% of some of its catches, would be closed to it or else they would have to pay massive fees to fish in British waters. Speaking of massive fees, the Republic would end up paying a staggering £1.5 billion annually, going forward, to be a member of the EU.
Frankly, that should put the fear of the Almighty into the Republic to urgently cheer on a trade agreement that instead of penalising them actually works for them.
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