The protocol created a ‘feast or famine’ economy in Northern Ireland

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The Northern Ireland protocol has created a ‘feast or famine’ economy in the region, with some businesses struggling while others thrive, according to a parliamentary report.

A House of Lords committee examining post-Brexit trade deals in the Irish Sea found that companies involved in trade with the rest of the UK were hampered by additional red tape, while those more reliant on trade relations with Ireland and the wider EU benefited.

The committee stressed the urgent need to resolve the problems created by the protocol and called on the EU and the UK to resume negotiations.

The committee’s report comes amid a breakdown in relations between London and Brussels over the UK government’s controversial plan to pass legislation at Westminster that would give ministers the power to unilaterally tear up the bulk of the protocol.

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Lord Jay of Ewelme who chairs the Northern Ireland Protocol Committee (UK Parliament/AP)

Peers said both sides needed to rebuild trust and repair damaged relationships and recommit to finding an agreed solution. They said a “mutually agreed solution” was the best outcome as they called for a compromise.

The protocol was agreed by the EU and the UK in 2019 as a way to avoid a hard land border on the island of Ireland.

It did this by moving regulatory and customs processes to the Irish Sea, creating new controls on goods being shipped from Britain to Northern Ireland.

While businesses involved in transporting UK goods to the region have been hit with additional bureaucracy, Northern Ireland businesses involved in selling into the EU can do so without restriction, giving them a potential advantage. over their competitors in the rest of the UK.

Lord Jay of Ewelme, who chairs the Protocol Committee on Ireland/Northern Ireland, said: “The Committee’s engagement with businesses trading in Northern Ireland and with Northern Ireland has demonstrated that, although many uncertainties remain, the economic impact of the protocol is gradually becoming clearer.

“The situation has been described to us as ‘feast or famine’, where companies able to profit from the protocol benefit, while those dependent on trade with Britain lose out.

In preparing its report, the commission gathered testimony from the five largest parties in the Northern Ireland Assembly, the UK and Irish governments, business representatives, academics and civil society representatives.

Peers said the maritime border has created increased bureaucracy, leading to additional pressures on companies’ staff resources, increased costs and longer delivery times.

They said the arrangements had a “disproportionate negative impact” on small and medium-sized enterprises (SMEs).

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A Border Force officer returns paperwork to a transport driver at a port screening facility in Belfast (PA)

The committee said there remained concerns that businesses in Britain would eventually decide to pull out of the Northern Ireland market.

Looking at the businesses that benefit from the protocol, the commission highlighted the dairy and meat processing industries, which depend on complex cross-border supply chains on the island of Ireland.

They said these sectors would be damaged if access to the EU single market was lost.

The committee has identified several solutions advocated by the Northern Irish business community.

These include a call for ‘proportionality’ in the application of rules and controls on Irish Sea trade and differential treatment for UK goods whose final destination is Northern Ireland, compared to to those intended for transport to the EU.

One of the UK’s favorite resolutions is the creation of a dual regulatory system where companies could choose to comply with either EU product standards or UK rules.

The committee said there was “widespread concern” among businesses about the practical feasibility and implications for cross-border supply chains of the proposal.

The report follows an introductory report published by the commission 12 months ago.

Lord Jay added: “Business representatives have proposed a number of mitigations and solutions to lessen the practical impact of the Protocol, and many of these proposals remain unchanged from the Committee’s July 2021 Introductory Report.

“At that time we stressed the need for dialogue to resolve the issues raised by the protocol for the benefit of the people of Northern Ireland. It is deeply regrettable that in the twelve months since , the state of political dialogue on the protocol has further deteriorated.

“There is an urgent need to relaunch the dialogue. We therefore call on the UK and the EU, as well as political parties and stakeholders in Northern Ireland, and the Irish Government, to renew their commitment to working together to put Ireland’s interests first. of the North, to engage together in constructive engagement, rebuild trust and engage in building effective relationships.

“As one of our witnesses told us, those who negotiated the Belfast/Good Friday Agreement were able to do so because of their ability to appreciate the views of others and their willingness to work together and taking risks to achieve a common goal despite historical differences.Such a courageous approach is needed now.