Receive Focus insights straight to your inbox
This would require all goods heading to NI from Great Britain (GB) to be checked at border posts in GB. Customs checks between NI and the Republic of Ireland (RoI) would also need to take place, but the proposal envisages that goods movements between the two would be notified to relevant customs authorities via prior declarations with a small number of necessary checks taking place at traders’ premises or other designated locations. In any case, this would be away from the RoI/NI border which would obviate the need for a physical border, thus complying with the spirit of the Good Friday agreement.
If agreed by the EU27 and ratified by Westminster, the envisaged transition period to 2020 would be maintained, during which the UK/EU27 relationship would remain almost identical to current arrangements. Indeed over this period, the NI Assembly and its Executive would be required to give its consent to the arrangements (we note that Stormont has not met since early-2017). Thereafter this would be required every four years.
This would replace the existing NI backstop which has proved troublesome over the past two years. In response, the DUP (NI’s largest political party and also, of course, the Conservatives’ confidence and supply partners) sounded a positive note, stating that the offer ‘provides a basis for the EU to continue in a serious and sustained arrangement with the UK Government…’. Indeed the UK government has offered a ‘New Deal’ for NI to help boost competitiveness and growth within the province.
Current thinking seems to be that UK/EU27 talks have to be finalised by 11 October for the EU Council to approve the Brexit deal.A further detail included in the PM’s letter to EC President Jean-Claude Juncker is that the Johnson government is seeking a Free Trade Agreement with the EU, rather than a ‘customs partnership’ arrangement, the aim of Theresa May’s government. If accepted by EU27, necessary changes to the Political Declaration (i.e. the outline of the proposed future relationship between the UK and EU) would be necessary to reflect this shift.
Continues below ...
Last, the UK government made it clear that the proposals for Ireland should not be used as a template for the UK and the remainder of the EU after the transition period ceases at the end of 2020. Indeed were today’s proposals to gain acceptance by both Brussels and Westminster, the focus would inevitably begin to be trained on how to minimise trade frictions between the UK and the EU more widely. Sterling reacted positively. At the time of writing, the pound was trading at $1.23, a gain in excess of half a cent, while edging firmer to below the 89p level against the euro.
You may also be interested in:
Please note: This page is provided for information purposes only and should not be construed as an offer, or a solicitation of an offer, to buy or sell financial instruments. This page does not constitute a personal recommendation and is not investment advice. Any predictions, or forecasts expressed are based on significant judgement and analysis of available information at the time of writing and actual outcomes may be materially different and may be affected political, economic or any other relevant circumstance changes