Brexit For Dummies
Book image
Explore Book Buy On Amazon
Brexit has brought about a whole new treasure trove of economic and political concerns. One in particular is that concerning how Brexit will impact Norther Ireland. If you’re living in the UK, you heard a lot about Northern Ireland and the “backstop” during the Brexit negotiations. In fact, the backstop became one of the major sticking points as far as Brexit was concerned when the withdrawal agreement went before UK Parliament for approval.

Brexit and Irish backstop ©Shutterstock/ratlos

But what is the Irish backstop, and what does the withdrawal agreement mean for the frictionless border between the Republic of Ireland and Northern Ireland? Before you can understand that, let’s have a super-quick history lesson.

The trouble of Northern Ireland and Brexit: The Good Friday Agreement

Signed in 1998, the Good Friday Agreement (also known as the Belfast Agreement) helped to bring about peace on the island of Ireland and end what was known as “the Troubles,” a decades-long conflict between the Unionists/Loyalists (who wanted Northern Ireland to remain part of the UK) and the Nationalists/Republicans (who wanted Northern Ireland to join a united Ireland). There was a whole lot of religious disagreement mixed in there, too — Unionists were mostly Protestant and Nationalists were mostly Catholic.

After decades of violent conflict (which spilled over into the Republic of Ireland and the island of Great Britain), the UK government, the Irish government, and various parties from Northern Ireland signed the Good Friday Agreement. (The United States also played a key role in the discussions.) This agreement created a devolved government in Northern Ireland (called the Northern Ireland Assembly), with the Unionists and Nationalists governing together in a power-sharing arrangement.

It wasn’t all plain sailing from there; the Northern Ireland Assembly was suspended in 2002 for five years, and the power-sharing arrangement broke down again in January 2017, resulting in the Northern Ireland government being dissolved. In April 2019, the two main parties in Northern Ireland had yet to reach an agreement and form a new government.

What’s all this Northern Ireland history got to do with Brexit? Well, a key part of the Good Friday Agreement is the complete removal of physical borders between Northern Ireland and the Republic of Ireland — as well as free movement across both countries. This is not just about making inter-island trade and travel easier; it’s also about allowing closer ties between the communities and breaking down the barriers (physical and otherwise) to peace and stability.

However, this lack of border caused a major problem in the UK–EU negotiations. Why? Because no physical border between Northern Ireland (which is part of the UK) and the Republic of Ireland (which is part of the EU) means no border between the EU and a non-EU country. The UK and the EU had to find a way to overcome this hurdle, without jeopardizing peace and stability on the island of Ireland.

It’s important to note that no one, including the EU, wants to see a hard border between Northern Ireland and the Republic of Ireland. No one is in favor of installing border controls. However, the EU obviously wants to protect its single market and customs union from the uncontrolled flow of goods — and it needs some form of customs control to do this. Meanwhile, the UK obviously wants to ensure that Northern Ireland isn’t isolated from the rest of the UK, and that Northern Ireland doesn’t return to conflict.

Various solutions have been proposed, including a border down the middle of the Irish sea, effectively separating Northern Ireland from the rest of the UK — an idea that angered the Democratic Unionist Party in Northern Ireland, prompting Theresa May to reject the proposal. The EU also proposed that Northern Ireland become part of a “common regulatory area” with Ireland, which would mean Northern Ireland being subject to different regulations than the rest of the UK — an idea also rejected by the UK government.

What the Brexit withdrawal agreement says about the Irish backstop

Until it becomes evident what the UK’s future trade relationship will be with the EU, it’s impossible to find a permanent solution to this problem. The border issue will, therefore, form part of ongoing Brexit negotiations between the UK and the EU.

That’s why the withdrawal agreement includes a provision for a temporary customs union between the UK and the EU until a trade deal is agreed. This provision is known as the backstop. If the UK and the EU haven’t agreed on a trade deal that avoids a hard border before the end of the transition period, then the backstop arrangement will kick in. In this way, the backstop is like an insurance policy.

The Irish backstop arrangement is as follows:
  • Until a trade deal is agreed upon, Northern Ireland will be aligned to EU rules on issues such as food and the standard of goods. This would mean there’s no need for border checks between Northern Ireland and the Republic of Ireland, because Northern Ireland would effectively be treated as part of the EU.
  • In theory, goods flowing from the rest of the UK into Northern Ireland (and vice versa) would be subject to checks and controls. However, the backstop allows for a single customs territory (basically, a temporary customs union) between the UK and the EU, which ties the UK to EU customs and control for the duration of the backstop.
  • As long as the Irish backstop is in force, the UK will have to comply with “level playing field conditions,” which are designed to prevent competitive advantage. For example, the UK wouldn’t be able to implement any trade deal with non-EU countries that would involve removing tariffs on goods.
  • Neither party can unilaterally withdraw from this temporary customs union, meaning the UK can’t withdraw from the backstop without EU approval. You can imagine how those in favor of Brexit feel about this!

Here’s the really big problem, though. The backstop is intended to be a temporary arrangement, with the above conditions, until a proper trade deal is agreed upon between the UK and the EU. However, if the UK and the EU can’t agree on a trade deal, then the backstop would apply indefinitely. This would tie the UK to the EU single market, and EU control, indefinitely. Having no guaranteed end to the Irish backstop is a huge concern for many people who voted to leave the EU.

You can see why the border was one of the toughest parts to negotiate in the draft agreement. And when the agreement was published, and people began to fully understand what the backstop might mean, that’s when the fun really began. The backstop became one of the biggest talking points as the UK Parliament came to vote on the withdrawal deal.

This issue continues to be one of concern as Brexit negotiations continue.

About This Article

This article is from the book:

About the book author:

Nicholas Wallwork is a leading international real estate market commentator, entrepreneur, business leader, investor, developer, and author. In addition to heading several real estate and investment companies, he wrote Investing in International Real Estate For Dummies and has produced and presented real estate TV shows on the UK's Sky TV.

This article can be found in the category: