Economist: politicians may claim we can have our cake and eat it – but cost of EU market access is Irish Sea border and the 'unravelling' of UK integration

As the DUP and UUP back EU market access, Esmond Birnie says that while it’s understandable that politicians may want to claim we can have our cake and eat it – it comes at the price of an Irish Sea border and the “unravelling” of Northern Ireland’s place in the UK economy.
Dr Esmond Birnie from Ulster University says there is an economic cost to EU market access - as the two main unionist parties come out in favour.Dr Esmond Birnie from Ulster University says there is an economic cost to EU market access - as the two main unionist parties come out in favour.
Dr Esmond Birnie from Ulster University says there is an economic cost to EU market access - as the two main unionist parties come out in favour.

Asked by the News Letter if it is possible to have full access to both the UK and EU markets – Mr Birnie, senior economist at Ulster University, said: “In a rather abstract or legalistic sense it may be possible to design NI’s post-Brexit trading arrangements to allow it free access in both directions”.

However, he said the real economic problem is that “so-called ‘dual market’ access may well be possible only at the cost of severe practical problems which imply the alleged ‘unfettered’ access to the rest of the UK is not really as straightforward as claimed”.

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“Both the Protocol and the Windsor Framework (according to the UK Government) allow the free market access in both directions. As an economist I would say such statements are true as far as they go but they don’t go far enough. Crucially, the ‘price’ of the continued access to the EU Single Market is the border in the Irish Sea, whatever frictions that entails – these will all entail raised costs on goods brought into NI from GB.

Mr Birnie said that for NI manufacturing businesses who have traditionally sourced goods from GB: “There is now (and it is likely to continue under the Windsor Framework) an added cost given the Irish Sea border frictions”.

He says whilst NI businesses have access to the GB market they may find themselves being priced out.

“It is understandable why politicians may want to claim we can have our cake and eat it. Economics and hence business life, however, is all about trade offs. Yes, there would be some gains if NI retained full access to the EU’s Single Market. But, against that, is the likelihood that Windsor Framework arrangements over the long run are likely to imply an unravelling of our previously very high integration into the rest of the UK”.

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