Comment

The Northern Ireland Protocol: is there another way?

Philip Rycroft / Nov 2021

Photo: Shutterstock

 

Lord Frost, Britain’s chief Brexit negotiator, is back in hard man mode. Almost daily, he threatens to invoke Article 16, the safeguard clause in the Northern Ireland Protocol. He claims that we are now well past the point where use of the clause is justified by the political problems in Northern Ireland and diversion of trade caused by the Protocol.

Is this just negotiating tactics or will he and the Prime Minister take the leap into the unknown? With this most contrary of governments, no one can be entirely sure. For their part, the European Commission has clearly worked out that the only way to deal with tough bluster is to brief dire counter-measures, up to and including suspension of the entire Trade and Cooperation Agreement. This would potentially throw the UK into a year of negotiating uncertainty with the prospect of a No Deal outcome at the end of it.

The stakes are high. The risk of a trade war will have a chilling effect on economic activity across the whole of the UK, not least in Northern Ireland. With elections for the Northern Ireland Assembly due next year, few may dare to predict whether the Northern Ireland Executive will survive the bruising battles around the Protocol; the future of the Peace Process itself hangs in the balance.

Can the battered Protocol, in spite of everything, still be made to work? Or is there an alternative way forward?

No one would claim that the Protocol is perfect. But this is the international treaty that David Frost and Boris Johnson negotiated back in late 2019 and sold to the UK electorate as part of an ‘oven-ready’ deal. It frankly beggars belief that the two were not well briefed on the likely impact of the Protocol, in terms of border checks, trade diversion and cross-community acceptance in Northern Ireland. They might fail to own the consequences now, but they signed up to it as the key to getting Brexit done.

Whatever the expectations of Frost and Johnson, the Northern Ireland business community was clearly shocked by the rigour of enforcement by the European Commission of the new rules on trade from Great Britain to Northern Ireland. No doubt the Commission erred on the side of caution; the offer now on the table from Commissioner Šefčovič to reduce the volume of checks would have been better delivered at an earlier state in this saga.

For Frost, these proposals do not go far enough. He appears to have four main beefs with the Protocol that he negotiated; how do they stand up to scrutiny?

He claims that the Protocol in action is leading to trade diversion, with an increased flow of goods between the North and the South and a drop off between the East and the West. The extent of this is not yet clear, but that there has been some trade diversion is neither unexpected nor surprising. Trade flows are diverted by trade barriers and there are new obstacles to trade between Great Britain and Northern Ireland. That is the essence of what Frost negotiated but is balanced by the greater advantage to Northern Ireland of being simultaneously in the UK internal market and the EU single market.

The UK side also suggests that the risks to the Single Market that the Protocol was meant to guard against have been overdone. A porous border between GB and Northern Ireland, it is said, will not lead to significant leakage of illicit goods into the Republic and the wider single market. This is not a new issue; I remember teams poring over this in immense detail when I was in the Brexit department.

In truth, the risk is modest when trading terms on either side of the border are more are less equivalent, as they are now in respect of standards and tariffs. But the whole UK approach to Brexit is to lock in divergence from the EU and divergence will create incentives for illicit trade, as has long been the case, for example, with excise duties. Moreover, policing the land border to stop trade in animal and plant products that do not meet EU standards would put an intolerable burden on the Republic; it would, in effect, be an assault on their sovereign decision to be a full participant in the EU single market.

Frost has discovered a particular animus against the role of the Court of Justice of the European Union in the governance of the Protocol. He knew fine well when he signed up to the deal that the Court is integral to the sustaining of the legal order that underpins the single market; every Brexiteer worth their salt had been inveighing against precisely that for many years. So he knows too that this is in effect a demand to undo the Protocol in its entirety because the EU cannot accept that Northern Ireland as part of the single market sits outside the reach of its legal guarantor.

The UK side also point to the lack of cross-community support for the Protocol in Northern Ireland. There is truth in this too. Recent polling, while showing that a majority, by a small margin, now think that the Protocol is a good thing, this view is viscerally opposed by many in the Unionist community. This is perhaps the toughest challenge of all, the origins of which lie at the heart of the Brexit project. For of course Brexit itself did not command cross-community, or even majority, support in Northern Ireland. Any undoing of the Protocol, particularly in ways that were seen to damage the Republic, would evince an equal and opposite reaction from the Nationalist community.

For all the faults in the Protocol, it is very hard to see an alternative way forward, beyond the sort of easements on checks proposed by the European Commission. In the context of a hard Brexit in which alignment with EU standards was rejected, something very akin to the Protocol is the only viable way to manage the conundrum that Brexit posed for trade on the island of Ireland. Flawed it may be, but it remains the least worst solution to an impossible problem.

A wiser government would recognise that it has to lie in the bed it has made for itself. It would seek to dedramatise the concerns about the Protocol and work with both communities in Northern Ireland to emphasise its potential benefits to the economy while offering reassurance on what it means for the future of Northern Ireland within the United Kingdom. Instead, caught in the net of his own ideology, Frost risks blundering into a highly damaging confrontation with the EU from which there is no visible exit route. We can only hope that wiser counsels will prevail.

 

 

Philip Rycroft

Philip Rycroft

November 2021

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