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Brexit: EU leaders should admit NI Protocol has failed

  • Are post-Brexit tensions over Northern Ireland protocol simmering?
  • US President Joe Biden becoming a decisive figure over NI protocol
  • UK manufacturers hit by the slump in exports before UK leaves EU
  • UK International Trade Secretary raises hopes of a UK-US trade deal

According to recent reports, post-Brexit tensions could see the European Union pressure Britain to surrender in the ongoing dispute over Northern Ireland protocol.

Although Britain and the EU managed to resolve their differences on the so-called “sausage war”, more significant problems appear to be looming, with supermarkets now warning that NI protocol price hikes could force retailers to switch from UK suppliers to EU alternatives.

The grace period on moving goods from Britain to Northern Ireland was extended for another three months in June to avoid a ban on chilled meats.

After the bloc granted the extension, the UK government said it would work tirelessly to reach a permanent solution on the “sausage war”, as well as broader issues concerning NI protocol.

However, little progress has been made since the announcement, with Britain accusing the bloc of being inflexible and Brussels claiming that UK Prime Minister Boris Johnson has failed to honour the commitments outlined in the Brexit Withdrawal Agreement.

Last month, EU Commission President Ursula von der Leyen demanded the UK to “uphold the deal and implement what we have agreed upon”.

Recent reports have also suggested that all 27 member states could unite and apply pressure on British PM Boris Johnson.

EU

Other EU member states backing Ireland on NI protocol

Expert on European affairs Kevin Featherstone said PM Boris Johnson would face significant pressure from the bloc over NI protocol, with the other 26 EU member states said to be already “lining up behind Ireland.”

Mr Featherstone stated: “The EU27 have been remarkably united, from the rest of the EU’s point of view, do they care about the border with Northern Ireland if you are in Athens or Madrid?

“I think what they have accepted is a culture of ‘we stand together because that’s the only way we can keep the 27 on the road.”

The London School of Economics professor also warned that Mr Johnson’s biggest challenge is French President Emmanuel Macron. Some journalists believe that Mr Macron is plotting a “bitter revenge” against Brexit Britain to help boost his status ahead of the presidential elections in France.

Democratic Unionist Party leader Sir Jeffrey Donaldson has urged the EU and the UK to renegotiate NI protocol, stating that the failed policy has created significant trade issues.

Ahead of a virtual meeting with EU Commission VP Maros Sefcovic, Sir Jeffrey said that the approach to implementing NI protocol was having a “damaging impact on Northern Ireland’s economy and relations with England and the other devolved nations.”

Mr Donaldson also accused the bloc of “facilitating the Irish Republic in attracting more Northern Ireland companies to use them as their supply chain.”
Adding that unless the bloc recognised its failings, “the UK has every right to take unilateral actions in such a situation.”

Brussels and London are also expected to clash over UK Prime Minister Boris Johnson’s handling of the COVID crisis. The EU is reportedly concerned over the final unlocking of the UK economy amid the high prevalence of Delta variant cases in the country.

According to GOV.uk, 48,161 people have tested positive for COVID-19 in the last 24 hours, with 36,800 new Delta variant caseloads reported in the week ending July 14th.

Although this is significantly lower than the 54,268 new cases reported the previous week, some EU countries may reimpose travel restrictions against UK tourists and tighten entry rules due to the growing spread of the virus.

Kevin Featherstone said that British tourists shouldn’t have much to fear if Britain manages the third wave. However, signs that point towards a darker scenario, such as the daily infection rate exceeding 100,000 or the NHS struggling to cope, will more than likely see European countries reintroduce curbs against Britons.

It comes as Britain’s largest supermarket chains warn that NI protocol price costs could force UK retailers to switch from British suppliers to EU equivalents.

UK supermarket chains deliver warnings over GB-NI trade

Representatives from British supermarkets, including Tesco, Sainsbury’s and Asda, have addressed a joint letter to Downing Street and the European Commission highlighting their concerns over red tape price hikes.

The British retailers called for a “swift, decisive, and cooperative movement”, adding that “more needs to be done before September-end to prevent any significant supply disruption and reduce costs for NI consumers.”

If unresolved, UK supermarkets said they might be forced to shift supply chains from Britain to the EU to minimise disruption.

Under post-Brexit arrangements, NI should follow EU animal welfare and food standards. However, new trade rules have sparked tension between the EU and Britain and resulted in significant delays in supply.

While the EU agreed to extend the grace period on goods travelling between Northern Ireland and the rest of the UK until September 30th, the two sides are yet to reach a long-term solution on the issue.

With the end of the grace period fast approaching, British retailers are urging Brexit Minister David Frost and EU counterpart, Maroš Šefčovič, to help “minimise disruption and allow UK supermarket chains to continue offering NI consumers with choice and affordability.”

The British Retail Consortium (BRC) also called for an “industry consultation” to find a “working solution”, noting that failure to resolve the matter would raise costs and make trade between Great Britain and Northern Ireland more complicated for retailers.

Meanwhile, Conservative MP for Wokingham and leading Brexiteer, Sir John Redwood, commented: “I’m glad to see British retailers speak out on the damage the European Union’s policy has done to GB-NI trade.”

Uncertainty stemming from the UK’s departure from the EU has been felt across the UK economy even before a Brexit deal was concluded, with British manufacturers facing significant disruption.

UK manufacturers struggling with Brexit procedures

According to new research from Make UK and international accounting network Binder Dijker Otte (BDO), manufacturing firms heavily reliant on the EU as an export market saw their dependence decline long before the signing of the Brexit deal.

The study revealed that only manufacturing firms in the West Midlands and Scotland saw an increase in exports to the EU in 2020, albeit the rise was marginal.

While post-Brexit trade with the EU improved in Q1 2021, their data shows that exports were still 27% lower than during the same quarter the previous year.

The manufacturing sector has urged the UK government to provide more targeted support to help businesses adapt to new trade rules and procedures.

The survey found that 96% of manufacturing firms had faced challenges following the Brexit transition period. Make UK also highlighted that the figures supported anecdotal evidence that companies were choosing not to export to the EU or that EU customers were turning away from UK-based firms.

Make UK Chief Executive Stephen Phipson said: “Evidently, uncertainty over a Brexit deal hit UK exports to the bloc.

“Although opportunities are propping up elsewhere, the European Union remains our largest trading partner through sheer fact of geography, meaning pressures are going to continue.”

It comes amid news that the Biden administration is urging Downing Street to respect the agreement with the EU, which draws a line down the Irish Sea between Great Britain and NI.

However, pro-British loyalists have criticised US President Joe Biden’s bias towards Irish republicanism, claiming that the new protocol violates the 1998 peace settlement.

US President Joe Biden is expected to become a divisive figure in the dispute over Northern Ireland trade as the conflict between Catholics and Protestants reignites.

However, this is not expected to harm a US-UK trade deal, with hopes of an agreement being secured boosted after British International Trade Secretary Liz Truss received praise from the American president.

Liz Truss boosts UK-US trade deal hopes

US President Joe Biden boosted hopes of a US-UK trade deal being reached after he praised UK International Trade Secretary Liz Truss during her Brexit Britain charm offensive.

Ms Truss travelled to Washington DC to meet with the US Trade Representative Katherine Tai to discuss a future UK-US free trade deal. It is understood that US officials were impressed by the International Trade Secretary’s approach.

The meeting is believed to have focused on how Britain and the United States can overcome market-distorting trade practices such as industrial subsidies and dumping, protect workers and firms by reducing unfair competition and strengthen supply-chain resilience.

Despite lofty praise, the White House has urged caution over the timeframe for which a US trade deal could be reached, warning that it could take more than a year to complete.