A significant fall in the number of Irish small and medium-sized companies trading with Britain is “a depressing commentary” on the effects of the United Kingdom quitting the European Union, a British minister has said.
“In trade, geography still matters,” said Douglas Alexander, minister of state at the department for business and trade in London, following a speech to the British Irish Chamber of Commerce annual conference in Dublin.
Nearly two-thirds of Irish SMEs have reduced, or stopped using British suppliers since Brexit, while more than a third have reduced, or stopped selling to British customers, according to a Strategic Banking Corporation of Ireland (SBCI) survey.
“Four out of the five largest trading partners of the United Kingdom are within the European Union. Ireland, I’m glad to say, is one of them – now the fifth-largest trading partner of the United Kingdom, about €100 billion this year, supporting 700,000 jobs,” he said.
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The survey’s findings are “challenge and a responsibility”, he said, because the British government led by prime minister Sir Keir Starmer wants “a reset” with European Union states, especially Ireland.
The paperwork challenges that have turned off Irish SMEs are problems widely shared. “We have many British businesses regrettably in the same position who found themselves buried in bureaucracy after Brexit.
“One of our challenges is finding practical means by which to support our own businesses that want to be exporting as well as supporting businesses in Ireland that want to export to the United Kingdom,” said Mr Alexander.
Mr Alexander made clear that any negotiations with Brussels over a reframed London-EU relationship will not be taking place until “the early part of 2025″, since the next European Commission has yet to bed down. However, he said that the negotiations will be at the edges of the relationship, and will not involve a fundamental renegotiation of Brexit arrangements. The “red lines” created by the UK’s departure will not be upset.
The fall in Irish SME trade with Britain is in stark contrast to North/South trade, which is heading towards €6 billion this year – “five times” the amount of just a few years ago, said Minister of State Thomas Byrne.
Meanwhile, Stormont’s Minister for the Economy Conor Murphy said the Windsor Framework is already benefiting Northern Ireland, even if there are complaints that large investments have not yet been announced.
Such deals do not “happen overnight”, he told the chamber conference. “We’re getting a lot of interest in [investments] but, organically, our exports to Europe are up 14 per cent. In Wales they’re static, in Scotland and in England they’re down.
“So, there’s something different happening here where we traditionally lag behind on most of the economic indicators. We’re the people who are investing, are exporting more in to Europe,” he said.
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