Businesses in North welcome signs of UK and EU taking a ‘step back from conflict’

Manufacturers in the North have urged the UK to reciprocate fresh moves by the EU signalling a “step back from conflict” over post-Brexit arrangements.

Stephen Kelly, chief executive of industry representatives Manufacturing Northern Ireland, said the latest remarks from the EU’s chief Brexit negotiator Maros Sefcovic could pave the way for both London and Brussels to get back around a table.

“There seems to be a pattern now emerging of the EU and the UK potentially taking a step back from conflict on this,” he said.

“That is to be welcomed. Both recognise that it is neither in the EU’s or UK’s interest, and certainly not in Northern Ireland’s interest, that both sides pick a fight on this.

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“We need to get to agreement, and the means to getting an agreement is by having conversations. So we need to get to the position where both sides think a conversation is possible and worthwhile.”

Speaking to the Financial Times on Monday, European Commission vice-president Mr Sefcovic said the trade border between Northern Ireland and Britain as a result of Brexit would be “invisible” under European Commission plans as long as the UK gave EU officials real-time data on trade movements.

“If the data is downloaded into the system, when the goods are put on the ferry from Britain... I believe that we can remotely process them while sailing to Northern Ireland,” said Mr Sefcovic.

This would mean physical checks on only a “couple of lorries a day” where “there is reasonable suspicion of... illegal trade, smuggling, illegal drugs or dangerous toys or poisoned food”.

Mr Kelly said the “helpful comments” were in some sense restating the EU position, but that they were made “in a way that signals a conversation is possible and could be hopeful, which is good”.

“We always felt there was a basis to get back round a table regardless, but the problem has been the UK government has insisted on the EU giving a new mandate to [Mr] Sefcovic, which there is no method to do, and the UK proceeding with its Northern Ireland Protocol Bill,” he added.

However, he warned Mr Sefcovic’s proposals on their own were not enough to lift the burden of checks on Northern Ireland businesses, who could face being shouldered with providing the data required by the EU.

“The reality has always been that it is not actually the physical checks that is the challenge for business, it is the burden of the administration that gets in the way of trade flowing freely between Britain and Northern Ireland,” Mr Kelly said.

“To get to the position where Sefcovic is outlining today, which is with more data comes more trust, with more trust comes reduced risk and less checks, then the beginning of all that is where does more data come from?

“It is produced by businesses and traders themselves, so that doesn’t actually move us a huge amount along. That administrative burden is the biggest challenge for many manufacturers in Northern Ireland.”

But Mr Kelly said the EU has shown itself keen to move further towards agreement on the post-Brexit arrangements to avoid a hard border on the island of Ireland and that “the UK need to move now also”.

“It makes no sense at all, for example, for the UK not to have some sort of agricultural agreement with the EU, that would remove lots of risk and costs and challenges,” he said.

“That in turn would be really helpful for households right across the UK as well as industry. It is not just about the EU moving, it is about the UK moving as well.”

Another senior business representative in the North, who spoke on condition of anonymity because of a moratorium on public comment after the death of Queen Elizabeth, described Mr Sefcovic’s remarks as “quite an encouraging signal to send at this time”.

“We would be cautiously encouraged,” said the representative.

“Systems have been developed since the [Brexit] process started to allow real-time data to be garnered and shared. Some will say ‘well, why should we have it for Northern Ireland and not Great Britain?’ It will be an issue for some — but it could be a smart, easy way to live with the spirit of what was agreed [in the Northern Ireland protocol].”

The representative also warned of the potential “administrative and bureaucratic burden” on traders to provide the data needed by the EU, but said this could be resolved through government supports.

“It is also important to make sure we don’t have a chilling effect, that there is a sense in Great Britain that there is something funny about dealing with Northern Ireland, so we’ll not bother,” the representative said.

“If there is a perfectly seamless data capture in place, great, but for occasional traders in Great Britain to Northern Ireland, who know there is something different, it could deter them from engaging in the market.

“We need to make sure there are not only no barriers but also no perceived barriers.”