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The growing case for the all-island economy

Businesses, staring down the double-barrelled threat of Covid and Brexit, are increasingly embracing the concept of an all-island economy in a bid to secure and maintain continued flow of trade north and south. Pavel Barter takes a look at what’s increased the appetite for greater co-operation

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Angela McGowan, Ian Marshall and Aidan Gough

Angela McGowan, Ian Marshall and Aidan Gough

Angela McGowan, Ian Marshall and Aidan Gough

If the pandemic has taught us anything, it’s the futility of having two strategies on one island. While islands such as New Zealand and Taiwan have kept the virus under control, the lack of alignment on either side of the border in Ireland did not help curtail the disease.

Ian Marshall, a beef farmer from Markethill in Co Armagh, and a former president of the Ulster Farmers’ Union, knows all about the importance of alignment between the two jurisdictions. “It’s difficult if you have a policy that stops halfway across the field and then introduce a different policy in the other half,” he told Ulster Business.

The same theory applies to business. The agri-food industry is made up of thousands of independent SMEs, split across various sectors, each with different requirements, regulations, controls, markets, and raw materials. Around 19% of all exports are to the south.

“(Some) 400,000 lambs travel from Northern Ireland to the south every year,” Ian said. He served on the Irish Senate between 2018 and 2020: the first unionist to be represented there since the 1930s. “10,000 pigs cross the border every week – 20% to 30% of our milk moves across the border. Any disruption to that complicates our markets.”

Yet, between Covid and Brexit, that disruption has become very real. IBEC-CBI Northern Ireland Joint Business Council (JBC) are among business groups focusing on an island approach to trade. The concept is not exactly new. IBEC and CBI have been involved in a range of all-island economy initiatives since the 1970s.

“We established a formal joint business council between CBI and IBEC in the early 1990s,” Fergal O’Brien, IBEC’s director of policy and public affairs, said. “One of the key projects we instigated in the early days was an all-island electricity market.”

Ian Marshall concurs. “This all-island stuff is spun as a new phenomenon, but since the Good Friday Agreement – when we had unfettered access to trade, goods and services across the land border – we effectively created a quasi island economy. Food manufacturers, processing companies, are already working across the jurisdictions.”

Across two decades, InterTradeIreland has helped over 20,000 businesses explore new cross-border markets, and it assisted companies during the Covid crisis through its Emergency Business Solutions support programme. Aidan Gough, designated officer at InterTradeIreland, is conscious of the challenges.

“We have to get real here,” Aidan said. “Businesses across the island are facing two generational challenges at once. We’ve gone from a healthy economy with healthy economic prospects to one now where over half of businesses are facing a decline.”

In the face of Brexit and Covid, “maintaining close all-island co-operation isn’t just essential for social and cultural ties, it’s also vital to the future success of Northern Ireland’s economy,” Angela McGowan, director of CBI Northern Ireland, told Ulster Business.

IBEC-CBI’s recent conference, Business On A Connected Island, explored market opportunities from an all-island approach. Politicians are following suit.

Taoiseach Micheál Martin established a shared island unit to facilitate cross-border co-operation – €500m (£452m) was allocated to cross-border projects in the 2021 Budget.

Infrastructure is among items on the investment agenda with money allocated into “key cross-Border infrastructure initiatives, including the A5, the Ulster Canal connection from Clones to Upper Lough Erne, and the Narrow Water bridge”.

But the need for alignment travels beyond roads and railway tracks. As Northern Ireland leaves the EU, information data protection between the north and the south will become an issue. Alongside IT, energy requirements will require cross-border collaborations.

“The North-south interconnector will play (a vital role) in delivering cheaper, more efficient energy to businesses and communities across the whole island of Ireland,” Angela said.

The Irish government and the NI Executive have taken jurisdictional approaches to climate action. “But there is an intention to broaden that out to an all-island collaboration,” Fergal says.

“Our climate agenda will require significant investment. For that investment, you’re going to have a stronger business case if you’re bringing economies of scale and solutions on an all-island basis.”

During his time in the Seanad, Ian Marshall sat on a Joint Oireachtas Committee for climate change. “Animal health, plant health, biosecurity, were always all-island initiatives,” he said. “When you roll that logic into climate – healthy soil, water, air – you can’t differentiate one side of an island from another.

“The waterways all flow into each other; the climate crisis is as pertinent on the north as it is on the south. So there needs to be better alignment.”

We may also see a stronger all-island perspective on the labour market: a legacy of the pandemic, in which people have become accustomed to working from home.

Why shouldn’t an employer from Ballymena consider an employee from Mayo, or vice versa? “Businesses will be more interested in how people work, rather than where they work,” Aidan Gough said.

“An all-island approach to the labour market is crucial to ensuring that firms in Northern Ireland can access the people and skills they need to grow and develop,” Angela added.

Ireland’s Shared Island Unit has proposed “a north-south programme of research and innovation, including an all-island research hub, through Universities Ireland”. 

Business groups contend that, post-Brexit, it will be important to align academic institutions on either side of the border. When he was a senator, Ian set up a meeting between Queen’s University Belfast (QUB), The National University of Galway, UCD, and Science Foundation Ireland, to drive R&D as an all-island collective. This resulted in a cross-border innovation hub.

“I think more of that will happen in the future,” Ian said. He is now a business development manager at the at the Institute for Global Food Security at QUB.

InterTradeIreland, which runs the US-Ireland R&D Partnership, has set up an all-island steering group to help increase north-south applications to the European Union R&D budget. Such cross-border partnerships “lead to the growth of businesses,” Aidan Gough said.

“Businesses that get involved in cross-border research, innovation, are three times more productive than businesses that don’t. They create more jobs and have higher turnovers.”

Inevitably, politics and history are obstacles. The Shared Island Unit in the Republic is unlikely to be effective without a similar level of investment and policy from the NI Executive. There have also been fears within unionism that the all-island approach may be a Trojan Horse for Irish unity.

“There’s no question that there’s nervousness, fears and concerns,” Ian Marshall said. “It’s like the old adage of a death by a thousand cuts. But I think we need to separate the constitutional question from benefits to the economy.”

Arlene Foster has welcomed the shared island approach: “It does not threaten our constitutional position or what we believe in so I don’t feel threatened at all by the shared island unit,” she said. The Taoiseach, meanwhile, has said that a border poll for Irish unification “is not on our agenda” for the Irish government for the next five years.

The final word should perhaps go to businesses which are enthused by the idea of collaboration and fresh thinking, on either side of the border, as they navigate the new trading relationships that will exist after Brexit. As Fergal O’Brien described it: “We need to look beyond challenges of the past... toward opportunities for the future.”

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