Cliff Taylor: Time for business leaders to get stuck into Brexit debate

Businesses on both sides of the Irish Sea have been unusually quiet in the recent Brexit dramas. No doubt they are nervous to be seen to stick their oar in when high politics is being played, though I'm sure that hasn't stopped them lobbying their governments behind the scenes.

However, it is now surely time to get stuck into the debate again. The Irish Border controversy has reopened the debate on the shape Brexit will take and it is time to highlight the extraordinary risks and job losses, which a harder version is bound to bring. Businesses need to get back out of their bunker and rejoin the battle.

UK businesses got badly stung during the Brexit referendum, where the vast majority ended up on the losing side. Here, the Border issue is so politically sensitive that business groups and leading figures have understandably been keeping their heads down.

And of course the absence of controls on the movement of goods across the Border would be a win for cross-Border trade and the many supply chains that go over and back.

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But there is also a real imperative for businesses to move on to phase two of the Brexit talks. No government among the European Union 27 knows this better than the Irish one, which has hoped that its push to sort the North-South Border issue might also show the way to progress on what is called the east-west dimension – trade between the two islands.

Standstill

To use the most overused Brexit cliche, the clock is ticking. Business do not even know yet whether there will be a transition deal after Britain leaves the EU – a kind of standstill during which, it is hoped, existing rules continue to apply as a new trade deal is negotiated. And beyond that years of negotiation could lie ahead on a new trade deal.

The UK – all of it – staying in the EU trading bloc to the greatest extent possible is quite possibly the only way Brexit gets done at all in any kind of manageable fashion. And you can only reckon that at least some of the Conservative Brexit lobby are now starting to realise this, and to count the economic cost that a hard Brexit would bring.

Why else would Boris Johnson have changed from saying Europe could "go whistle" for the payment of a Brexit bill to agreeing to pay €50 billion plus? And now David Davis, the Brexit secretary, is in the Commons, saying that all of the UK could have a form of "regulatory alignment" with the EU.

That said, some in the hard Brexit lobby still blindly call for the UK to walk away and this cannot be ruled out as the likely outcomes seem to move to two opposite extremes.

It is surely time now for businesses in the UK and on both parts of the island of Ireland to start piping up. The debate on the Border has highlighted the key economic issue at the heart of Brexit: whether the UK will leave the EU single market and customs union as it leaves the EU, at huge economic cost to itself and also to us.

This is the decision which would make a border necessary, and may still do so to some extent even if the regulatory humpty dumpty can be reassembled to allow the talks to progress.

Uncertain future

For UK businesses, the argument is straightforward. Why take on the immediate cost of leaving the EU trading bloc for the uncertain future of new trade deals with other countries likely to take years to negotiate?

For Irish businesses, the goal must be as long a transition period as possible followed by as free a trade agreement with the UK as can be negotiated. Cross-Border trade is important to Ireland, though of course much more is sold into the British market. For the first nine months of this year goods exports to the UK totalled €10.7 billion, versus just under €1.5 billion to the North.

So Irish business needs free trade to continue to the UK and also free transit through the UK to continue for goods going to continental Europe. New sea routes will only take up some of the slack.

Trade across the Irish Sea is also vital for the North’s business, involving sales some four times times greater than what is sold in the Republic – itself the biggest single export market. It is clearly in the North’s interests to maintain free trade in both directions – and the only way to guarantee this is for the entire UK to remain in the EU trading bloc.

Business leaders have been notable by their absence from the recent debate. It is time to get back out there. Brexit is a project which accepts an economic cost to achieve a political goal. But the price keeps climbing and the political advantages look ever more ephemeral.

There appears to be the start of a big push back against a hard Brexit and businesses need to be part of it.