Belfast Telegraph

John Simpson: This isn't just a Brexit wake-up call - Northern Ireland economy could soon be teetering on the edge of a cliff

John Simpson
John Simpson
John Simpson

By John Simpson

An exit from the EU without an agreed withdrawal deal is the worst conceivable economic crisis of the year. Now an official professional commentary says that 40,000 local jobs are at risk.

For the last three years the Brexiteers have cried 'foul' - the doom sayers were wrong, the economy has survived. But the economy has not yet left the embrace of the EU.

The day of departure could now, by default or incompetence, be October 31. The leaving of the EU might take one of several forms.

Does the UK leave:

  • With no-deal?
  • With no-deal but a temporary EU transition agreement, pausing the main changes?
  • Having persuaded the EU to reopen negotiations with a new UK team?
  • Having agreed a withdrawal agreement as commended by Theresa May?

The civil servants have now published their comprehensive review of how Northern Ireland's trade and investment may be affected by no-deal. This is the worst outcome for jobs and incomes here.

The extensive statistical evidence in a 25-page review gives a firm evidence base for people to try to influence Government policies in Belfast, Dublin, London and Brussels whilst arguing for mitigation.

Unfortunately, the ability to mitigate no-deal is limited, unless there is a more constructive conciliatory approach from currently intransigent principals.

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Two major negative factors loom large.

First, the expectation that new UK trade deals with refreshed trading partners, such as the USA, will offer early and effective alternative new markets for UK (and Northern Ireland) exports, offers no immediate relief from the scale of the business in the EU - including GB - that may be lost by increased costs of trade and regulatory rules. There is pain in selling to many existing markets, heavily influenced by big adverse changes in the agri-food trade supply chains.

Second, the expectation that the Irish border might be frictionless is under challenge. The border in Northern Ireland for goods from Ireland will have no duties imposed.

However, the border in Ireland for goods from Northern Ireland will become part of the EU frontier. Dublin has shown that Ireland cannot be a backdoor for EU imports.

A no-deal Brexit will be the most serious 'hit' to the NI economy in the last 40 years.

The Civil Service analysis is not just a wake-up call. It is a warning of an approaching cliff-edge.

Belfast Telegraph


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