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Analysis: Position paper does little to ease business concerns

The UK government position paper has done little to alleviate business concerns in Northern Ireland
The UK government position paper has done little to alleviate business concerns in Northern Ireland The UK government position paper has done little to alleviate business concerns in Northern Ireland

Avoiding a return to custom checks and a hard border were expected to be two key components of early UK government proposals for Brexit.

When the UK voted to leave the European Union a return to the 'borders of the past' as Theresa May put it, was not what anyone wanted, not least the business community in the north.

It is clear that both governments wish to preserve the status quo as far as possible, but the goal posts have been moved and Brexit will require an "unprecedented solution".

It appears that the sentiment at least of the position paper is in keeping with business interests in the north, but there is no escaping the uncertainty weighing heavy on the industry.

Earlier this month the Northern Ireland Chamber of Commerce and Industry and BDO Quarterly Economic Survey (QES), revealed that over a third of local businesses have already or are considering changing their target market due to Brexit, while seven per cent said they were looking at making changes to their business location or setting up a presence outside Northern Ireland.

This uncertainty has not been suddenly lifted by the position paper, instead it merely offers hope that trade can continue smoothly post Brexit.

Trevor Lockhart, deputy chair of the CBI in Northern Ireland has said the paper suggests the UK government is going in the right direction, but there is some way to go before businesses are appeased.

"Uncertainty weighs particularly heavy for firms and families in the region. Companies are making long-term investment decisions now and need to see much more detail on these proposals in the coming weeks," he said.

“What’s needed now is a pragmatic approach on all sides – this is an issue of mutual interest. A significant step up in engagement between the UK Government, Irish Government, local policy makers and businesses is needed.”

Of particular interest in the paper is a proposed cross-border trade exemption, which in essence would ensure smaller traders could continue to operate as they do now, with no new requirements in relation to customs processes.

According to the Northern Ireland Office figures 80 per cent of firms in the north are small or medium sized and engaged in local business rather than international trade, but deciding which businesses fall into the proposed new exempted category and then securing the best deal for the remaining 20 per cent is easier said than done.

The UK government paper is a step in the right direction, but there is a long road to travel to economic prosperity, made all the more treacherous by the lack of a functioning executive.