Total goods exported from Northern Ireland to the Republic of Ireland in 2021 equated to an estimated €4 billion (£3.35 billion). According to Ireland's Central Statistics Office (CSO), these latest figures represent an increase of 65% compared to 2020. The Northern Ireland Protocol, which was established following Brexit, is having a positive impact on trade between the two.
Has the Northern Ireland Protocol Benefited Irish Trade?
The UK exited the European Union (EU) bloc in 2020, with the full effects taking effect in January 2021. While Northern Ireland is a part of the UK and remains part of the EU customs territory, it still follows EU law governing the single market for goods.
The Northern Ireland protocol was established to maintain the level of trade that had been enjoyed between Northern Ireland and the Republic of Ireland before Brexit. Previously, both countries were part of the EU, which meant that goods could flow easily across the border without any paperworks because they both followed EU rules. However, with the UK leaving the union, Northern Ireland would no longer be following the same rules, meaning strict checks and paperworks would be necessary to trade goods across the border. To overcome this challenge, the Northern Ireland Protocol was established as part of the Brexit withdrawal agreement, which would allow Northern Ireland to continue to follow the EU Customs Code and remain in the EU single market.
Protocol Sets up Barriers for UK Exports to Ireland
Since the protocol was initiated, however, it has been more challenging for British businesses to export goods into either part of Ireland. Because Northern Ireland remains in the EU's single market, goods leaving Great Britain now face newly imposed checks and paperworks that were not necessary when both countries were part of the EU.
On the other hand, goods traded between Northern Ireland and the Republic of Ireland do not face checks and controls. This free movement has prompted businesses in both parts of Ireland to seek goods from the island of Ireland rather than Great Britain. This has resulted in the booming trade we are seeing between Northern Ireland and the Republic, which is a trend that is likely to continue into the future.
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