13 March 2019

The Government has finally revealed what it will do at the Irish border if there’s no deal – and while it’s probably good enough for Day One, it doesn’t work long-term, says Tim Durrant.

The long-awaited plan for how the Government intends to keep its side of the promise of ‘no hard border’ between Ireland and Northern Ireland if the UK leaves the EU with no deal has been published.

Goods crossing from Ireland to Northern Ireland will be exempt from the tariffs that the Government will impose on all other goods coming from the EU into the UK. This means Northern Irish businesses (particularly farmers) would be disadvantaged compared to their counterparts in Great Britain, many of whom will be protected by tariffs applying to imports to England, Scotland and Wales.

The Government also said it will not check goods at the border – importers will only have to notify authorities of some high-risk products, including certain plants and dangerous chemicals. UK VAT and excise duty would still be charged on goods coming across the border to prevent unfair competition.

The short-term plan creates disruption and uncertainty

The plan may allow the UK to avoid a hard border, but it leaves much unanswered. The Government has said that these are only temporary measures, not least because of the risk of increased organised crime or the likelihood of a legal challenge at the World Trade Organisation because the UK is not applying the same treatment to all its imports.

But there is no clarity on what comes next. The Government has said it wants to discuss longer-term arrangements with Dublin and the European Commission if the UK leaves with no deal. The EU has said this too. But any solution will take time to work out.

Until that point, fallout is inevitable. Irish businesses will have unfettered access to the Northern Ireland market, but it is not clear the EU will reciprocate. If the EU insists that Ireland preserves the integrity of the Single Market by imposing checks and tariffs, Northern Irish businesses may lose access to their markets in Ireland – and cross-border supply chains will be disrupted.

Northern Irish consumers may benefit, but Northern Irish producers may find Irish competitors diverting supplies north to take advantage of zero tariffs. The Government recognises the issues but offers no clear solutions.

The border has two sides – the Government has only considered one

The biggest unanswered question is what the Irish will do on their side of the border. The Irish Government has said it will not introduce any checks or infrastructure at the border. Like the UK’s proposal, that may work for a short time.

But eventually Ireland – and the EU as a whole – will be forced to work out how it will protect the single market from UK goods subject to a different regulatory regime. Border checks may become a necessity.

As ever with Brexit, this is only the beginning of the story. If MPs vote for no deal, or it happens by mistake, the debate on how to keep the Irish border permanently open will run and run.

 

Comments

All this seems to rest on the assumption that all parties will adopt a legal, not a politically pragmatic solution. If the Irish government would adopt a more collaborative approach [as Enda Kenny did], instead of the confrontational pot-stirring of Varadkar et al. this apparent mountain could be reduced to the molehill it actually is.

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