The Northern Ireland Protocol is having a “feast or famine” economic impact, according to a report from the British House of Lords.
The Sub-Committee on the Protocol on Ireland/Northern Ireland has today (Wednesday, July 27) published a follow-up report on the socioeconomic and political impact of the protocol.
It analyses developments in the year since the publication of its introductory report in July 2021.
The report found that businesses in Northern Ireland are able to take advantage of the trade benefit with the Republic, while those reliant on trade with the UK lose out.
The committee said that businesses trading with Britain were being negatively impacted by increased bureaucracy, staff resources, cost and delivery times.
It stated that small and medium-sized companies were suffering “a disproportionately negative impact” and outlined concerns that British businesses will withdraw from the Northern Ireland market.
The committee noted that the importance of the protocol for the dairy and meat processing industries which are dependent on complex cross-border supply chains.
It said that there are fears of the damage that would be caused to these sectors should access to the EU Single Market be lost.
It noted that businesses have put forward a range of solutions, several of which are reflected in the UK and European Union proposals.
This includes the need for proportionality in the application of rules and controls on movement of goods from Britain to Northern Ireland and the continuation of the various grace periods and derogations extended by the UK.
The committee said that a renewed commitment by the UK and EU, along with political parties in Northern Ireland, to rebuild trust and repair damaged relationships is urgently needed.
It stressed that a mutually agreed solution is the best outcome but noted this requires flexibility and compromise on all sides.
The Committee is set to scrutinise the UK’s Northern Ireland Protocol Bill and the EU’s response in the autumn.
Commenting on the report, chair of the committee, Michael Jay said that although uncertainty remains, the economic impact of the protocol is gradually becoming clearer.
“There is an urgent need for a reset of dialogue.
“We therefore call on the UK and the EU, together with the political parties, and stakeholders in Northern Ireland, and the Irish Government, to make a renewed commitment to work together to put Northern Ireland’s interests first, participate together in constructive engagement, rebuild trust and engage in effective relationship-building.
“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 perspectives of others and willingness to work together and take risks to achieve a common goal despite historic differences.
“Such a courageous approach is needed now,” he said.