Stephen Cadogan: Brexit: Ireland, the UK, and the North need to talk more

Uk exports to Ireland in 2015

The next two or three years will be a worrying time for the majority (56%) in Northern Ireland who voted to remain in the EU.

They include farmers who benefit from the North’s 9% share of the UK’s Common Agricultural Policy money from Brussels.

With only 3% of the UK population in Northern Ireland, they know the British government is unlikely to still give them 9% of agricultural funding.

Direct payments to farmers make up the biggest portion of the €3.5bn from the EU scheduled for Northern Ireland over the 2014-20 period, plus matching and additional funding from the UK and Northern Ireland governments.

The biggest uncertainty of all is what happens to the land border with the south, which had become almost irrelevant, but might now end up with customs and passport controls.

An estimated 18,000 people cross the border every day as commuters, and another 5,000 as students.

But it is the extent of agri-food trading that perhaps shows more than anything else how open the border had become.

If customs and passport controls are introduced, it will affect even the basic food items we depend on such as bread and milk.

For example, there are just three big flour mills in the island of Ireland, two of which are in Belfast, and the Belfast mills export 60% of their output to the South. At a “hard” border, the EU tariff on flour would be 65%, effectively killing off that trade.

Southern processing plants handle 40% (three million litres per day) of the milk produced in the North. In a typical year, a similar proportion of pigs are sent North to be slaughtered.

Just over half (worth almost €800m) of all Northern Ireland’s food exports travel south to the Republic.

About 350,000 sheep come to the South from Northern Ireland for processing in a typical year year.

Some 55,000 cattle went north of the Border in 2015, for breeding or slaughter.

In 2015, the south exported almost €750m of agrifood sector products to the North, of which beef represented €133m; live animals represented €99.8m; beverages came to €89m; cereals and cereal preparation, €84.4m; dairy products, €68.5m; fruit and vegetables, €53.3m; and forestry, €48.7m.

In the other direction came almost €569m of agri-products from the North, of which dairy produce came to €171m; animal foodstuffs, €90.7m; cereal and cereal preparation, €71m; fruit and vegetables, €43.9m; poultry, €35.8m; and forestry, €22.7m.

Here, the government says it is an extraordinarily complex area which must be worked through with our counterparts in Northern Ireland, to identify the best solutions to protect respective interests north and south. But the North’s First Minister Arlene Foster has insisted she will not join the Irish Government’s Brexit forum.

However, she intends to meet Taoiseach Enda Kenny for talks on Brexit in the next few weeks, and hopefully some progress can be made.

Progress is also needed in talks with the greater UK.

Trade flows of food produce between the UK and Ireland are larger than the bilateral flows that either jurisdiction has with any other country in the world, and account for almost £4 billion annually.

In the agrifood trade, half of all Irish beef goes to the UK consumer market. Ireland is the UK’s largest market and its second biggest supplier.

It is in the UK’s interests that it does what it can to smooth the future for its food and drink sector, which contributes £26.9 billion to the EU economy, more than the UK’s car and aerospace manufacturing sectors combined.

Talks with Ireland on post-Brexit possibilities could help.

Such talks should extend beyond food and drink, to encompass the 17% of all exports in 2015 to Ireland, making it the UK’s biggest export market. Ireland was the second biggest exporter to the UK (after the Netherlands).

As the EU member state most heavily dependent on the UK for both exports and imports, Ireland urgently needs to talk more to the UK.

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