DUBLIN — Britain’s loss has been Northern Ireland’s gain when it comes to post-Brexit trade with the Republic of Ireland.
Recently released figures for the first full year of UK-Ireland trade after Brexit confirm that cross-border trade is booming on the island of Ireland, while imports from Britain have falled.
Northern Ireland exporters emerged as the big winners, according to the Central Statistics Office study. This reflects how some Irish companies traditionally reliant on imports from Britain switched supply chains last year to companies in Northern Ireland.
These changes are prompted by the Protocol to the Withdrawal Agreement between the UK and the EU creating special trade agreements for both parts of Ireland. While the rest of the UK has left the EU single market, Northern Ireland has remained there to maintain barrier-free trade with its EU neighbour. This has given Northern Irish exporters an edge since January 2021, when goods from Britain began to face a host of new regulatory, customs and health hurdles at Dublin Port.
For many traders and manufacturers, almost overnight, it became easier for Dublin to order goods from Belfast than from London, and likewise easier for Belfast to order goods from Dublin than from London.
As a result, the report finds that the value of Irish exports to Northern Ireland jumped 54% in 2021 to an all-time high of €3.7 billion, driven by €1.3 billion of food and live animal shipments.
Trade accelerated even more strongly in the other direction, with Northern Ireland’s exports to the republic rising by 65% to €3.9 billion. This included €1bn in food and animals, a 43% gain on 2020 and a tripling of chemicals and pharmaceuticals to €850m.
Irish exports to Britain have maintained robust growth – largely because Britain, less prepared for a ‘hard’ Brexit than Ireland, has not put in place a full battery of controls at borders on imports from the EU. Ireland’s exports to Britain in 2021 increased by 17% to €14.4 billion, led by chemicals and medicines (€5.3 billion, up nearly 40%).
By contrast, the value of goods exported from Britain to the Republic of Ireland – mainly to Dublin Port – fell 13% last year to 15.4 billion euros. Substantial declines were recorded in food, drink, machinery and other manufactured goods, only partly offset by soaring prices for imported British fuels.
These figures will fuel the rhetorical fire of the Democratic Unionist Party, the main supporter of Brexit in Northern Ireland and opponent of the trade protocol it produced.
Both the DUP and the UK government have argued that the shift in the trade balance, laid bare in the CSO figures, can be cited as justification for triggering Article 16 of the Protocol, as it represents “trade diversion.” », an ill-defined condition contained in this article of the treaty.
A British invocation of Article 16 would empower Northern Ireland port authorities to suspend EU-mandated checks on goods from Britain, as Democratic Unionists have been demanding for a year.
But the Irish government hailed the CSO figures as confirming the wisdom of the protocol, which allows Northern Ireland-based exporters equal access to UK and EU markets.
Neale Richmond, EU affairs spokesman for the ruling Fine Gael party, said Northern Ireland’s export growth could not have happened without the protocol.
“Companies and traders have shifted their business models to the path of least resistance and are focusing their goods on the EU internal market,” said Richmond, who called for greater cooperation between trade promotion agencies. exports from Belfast to Dublin.