The agreement in Brussels on the terms of a transition period after the UK leaves the EU is welcome. A transition period – a kind of stand-still in many areas after the UK leaves which will last until December 2020 – would provide time to push ahead with negotiations on the future trading and political relationship between the EU and the UK after Brexit. It would also give businesses more time to prepare and remove the threat of a major economic shock early next year.
As the remaining EU member most exposed to Brexit, these are particularly important issues for Ireland. A transition period would remove the threat of the UK crashing out of the EU in March 2019 with no deal. However, it is also important to remember that the agreement on the transition is contingent on a final sign-off of the withdrawal text – and here some issues remain. Notable among these is the Irish Border.
The Government will be glad UK and EU negotiators have agreed that the final legal text must include details of how the so-called backstop arrangement would work. This is the arrangement which would apply if no other way could be found through negotiations to avoid a hard border on the island of Ireland after Brexit. The UK commitment to avoid any physical infrastructure of checks and controls at the Border has also been repeated.
However, while both sides have signed up to the principle, how this would be legally expressed in the withdrawal agreement has still to be negotiated. Much work remains to be done. Essentially, the same old problem remains. If the UK pushes ahead and leaves the EU customs union and single market, then avoiding the return of Border checks on the island of Ireland becomes difficult.
It could be achieved by giving the North some kind of special economic status, but this would involve new checks on trade between Britain and the North, which has been ruled out by the DUP and by London.
Free trade across the Border could also be achieved by a continued close alignment of the entire UK with the EU trading bloc, but this would run against the desire of the Conservative government to negotiate new trade deals with third countries and to have full control of its own borders.
There will be talks on the Border issue in the weeks ahead, to try to hammer out the details of the backstop arrangement. It is difficult territory, as talks on future trade relationships between the EU and the UK will continue into the transition period and these will have an impact on the future of the Border.
The risk for Ireland is of the Border slipping down the list of priorities in the talks as the two sides start to focus on the future relationship. However, so far EU support for Ireland’s Border demands has been rock solid.