Stormont report highlights Protocol burdens and risks for businesses - as well as costs of trade divergence
Reports commissioned by the Sinn Féin-run economy department has set out the challenges facing Northern Ireland businesses as a result of the Windsor Framework – and says any benefits of ‘dual market access’ are “heavily constrained by administrative realities”.
One of the papers found that businesses see the post-Brexit trade arrangements as having created a more predictable trading environment than before, but one “still marked by cumulative regulatory and compliance demands”.
They detail evidence of trade with Great Britain being diverted to the Republic of Ireland and the EU, with firms often paying out more to avoid the administrative burdens.
Safeguards in the UK-EU trade deal allow for either party to take “appropriate” safeguarding measures in the event of diversion of trade, but the UK government has not done this – and insisted it is committed to the full implementation of the deal.
The measures were put in place to deal with the fallout of the United Kingdom’s exit from the EU, and ensure that there were no physical checks on the Irish land border. Instead, Northern Ireland effectively remained in the EU’s single market for goods – creating am internal UK trade border with Great Britain.
Two reports were published by the Department for the Economy, including one produced by the economist Maureen O’Reilly examining the impact of the Windsor Framework on Northern Ireland businesses.
It details feedback from companies, including criticism of the benefits of dual-market access. That is the ability of local companies to sell freely to both the EU and UK markets, but with friction on GB ‘imports’.
The report says “the overwhelming feedback is that the benefits are heavily constrained by administrative realities.
“As one business observed, ‘Dual access is great, but the hurdles to get there aren’t small’. Many businesses reliant on supply chains originating in Great Britain find the administrative hurdles dampen the practical value of dual access”.
One respondent told officials, “We want to trade, grow and innovate — we just need the system to work with us, not against us.”
Difficulties for businesses sourcing goods from Great Britain were also noted. Dual market access means NI goods can be sold in GB or the EU – but the supply chain from GB is impacted by the Windsor Framework.
The report notes: “Supply-chain pressures remain among the most significant constraints. GB suppliers continue to raise minimum orders, add administrative surcharges or withdraw from supplying Northern Ireland entirely.
“This has pushed many firms to shift sourcing to Ireland or the wider EU, often at greater cost, simply because the administrative pathway is more predictable. Logistics and parcel operators report ongoing challenges with mixed consignments, rising handling fees and inconsistent data requirements, affecting both delivery times and competitiveness”.
However, Maureen O’Reilly’s report says that despite these pressures, Northern Ireland businesses continue to adapt.
“Some SPS processes are becoming more settled, engagement with government departments has strengthened and a small number of firms are beginning to leverage dual market access as a strategic advantage.
“However, the burden of adaptation remains substantial and uneven: larger firms absorb compliance through internal teams, while smaller firms face opportunity cost, reduced agility and increased management load. Innovation-led companies face additional uncertainty linked to dual subsidy-control rules, which can limit access to UK-wide programmes and delay investment decisions”.