Stormont is refusing to supply evidence for its claims that Northern Ireland benefits from UK and EU ‘dual-market access’.
The Department for the Economy and Invest NI have batted away questions from the News Letter with waffle about how it will take time to “raise awareness”.
Invest NI previously turned down a similar request under the Freedom of Information Act, claiming other investment agencies could use it “to diminish our position”.
If the measure of success is foreign direct investment, it appears to have declined, according to analysis from the big four accountancy firms. Ulster University economist Dr Esmond Birnie says this suggests “quite a lot of economic pain for little gain”.
Although Northern Ireland’s private sector is booming, the exception is manufacturing, the only area covered by dual-market excess.
There is one clear advantage to our unique post-Brexit limbo but it is an accident waiting to happen. Most staff recruited here can work in both the UK and the EU, a crucial benefit to industries such as haulage and entertainment, as is sometimes reported. Less noted is how vital this can also be to high-value services and manufacturing.
Firms in those sectors often need to send staff away to work with customers and suppliers. However, this form of dual-market access only applies to Irish passport holders and treating employees differently on that basis is against the law.
For the moment, everyone is tiptoeing around this but it is inevitable a discrimination case will blow it wide open and it is hard to see how it can be resolved. The EU is not about to recognise a distinct class of British passport holders from Northern Ireland, even if such a thing were feasible.
The official form of dual-market access is highly oversold and deeply flawed. Manufacturers can still encounter paperwork when exporting to the EU and Britain and they face major sea border frictions when bringing in raw materials and parts. The Marie Antoinette-type cries of ‘let them source from the EU’ ignore the currency barrier, the cost of transport or the Republic’s need to source from Britain.
While the Windsor Framework promises frictions will eventually ease, they are still getting worse as the new regime is phased in.
The business-to-business parcels deadline at the end of this month is far more serious than is generally realised. Media coverage tends to suggest it is mainly an issue for small shops selling knick-knacks from England. It is also a looming disaster for manufacturing, cutting off supplies of samples and specialist equipment. Much commercial research and development could become impractical.
The realistic view of Northern Ireland’s position is that we offer a unique set of problems and opportunities. This can still be attractive – investors look for such differences to exploit – but we are not “the world’s most exciting economic zone”, to quote Rishi Sunak, and making that claim will only invite disappointment and ridicule.
Our arrangements could be carefully presented as an issue now under control and set to reduce in impact over time. This would address the absurd conundrum that everyone wants our supposed advantage to end: nationalists through a united Ireland, unionists through a Stormont vote, and the government through closer alignment with Europe.
It is becoming painfully obvious that we can find no poster-child foreign investor for our unique position. There is no ‘Protocol DeLorean’, if you will pardon the example. Expectations of Invest NI may be low but there were higher hopes for US special economic envoy Joe Kennedy III. Even the support of the White House has not made a silk purse out of a sow’s ear.
Northern Ireland has the home-grown example of Almac, the Craigavon-based pharmaceutical company. It has made a success of our unique arrangements, having initially feared Brexit would force it to relocate to the Republic.
But Almac hardly wants Invest NI to share the hard-won secrets of its success with overseas competitors, and rightly so. A previous incarnation of the company was bought by a US rival with the intention of moving work out of Northern Ireland.
One thing we can learn from the US is how it treats potential foreign investors. American bureaucracy is capricious and ferocious – worse than our own in many respects. Investors arriving in the US can expect to be greeted by officials bearing detailed bespoke plans to help their businesses cut effortlessly through it. Nothing will be too much trouble.
Could Stormont and Invest NI at least manage that?
