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Has the Brexit deal weakened the economic case for a United Ireland?

If you’ve been paying attention to the hundreds of books, articles, symposiums, television panel shows and radio segments about a united Ireland over the past five years or so, then you will know that one of the major arguments advanced for Irish unity is economic.

That argument goes a little like this: That as a rump outpost of the United Kingdom, Northern Ireland is, at the very best, an afterthought for London. It depends largely on economic transfers from English taxpayers to keep the lights on. In fact, it has a substantially larger public sector than the Republic, with many more people employed by the state per head of population than in the south. It is not – the argument goes – fully integrated into the UK economy.

A United Ireland, proponents argue, would change that by delivering an all-Ireland economy, allowing the North to join in the relative economic success of the South over the past four or five decades.

A major reason why – many people believed – Brexit would hasten Irish unity was precisely this. The Northern Ireland protocol erected trade barriers between Northern Ireland and the UK, with a requirement for customs checks in the Irish Sea. At the same time, cross-border trade remained unimpeded.

Over time, it was argued, this would draw NI infinitely closer to the Republic, economically speaking, and away from the orbit of London. Over time, it would make the case for Irish unity on economic grounds unimpeachable.

On Monday, though, the new Windsor Accords were agreed in principle. The biggest single change in those accords is that all trade barriers between Northern Ireland and the UK mainland will be removed for goods that are to stay within the UK’s single market. Irish Sea checks will now only apply to goods that are destined for the Republic.

Assuming that this is implemented, it is worth considering how it changes the potential economic arguments around Irish Unity.

The biggest single change is this: A United Ireland would now require the putting up of economic barriers, rather than their removal. A unitary Irish state, inside the EU, would not have unfettered access to the UK single market in the way that, under the terms of Windsor, Northern Ireland will have. For Northern Irish businesses trading with the UK, a United Ireland would now mean more paperwork, more bureaucracy, and more costs, because of the re-implementation of customs checks in the Irish sea.

This is similar to the problem faced by the Scots – the dream of an independent Scotland in the EU was, some felt at the time, enhanced by Brexit. In reality, Brexit has caused significant problems for the case for Scottish Independence, because in a post-Brexit world, an independent Scotland inside the EU would need to erect a customs border along Hadrian’s Wall to impose taxes on products going to and from England and Wales. It would make life more difficult for Scottish businesses who trade with the rest of the UK.

This is now the position in Northern Ireland as well: A United Ireland means losing unfettered access to the UK market.

Further, in the longer term it might be expected that this agreement will favour and promote trade between NI and the UK mainland over and above north-south trade, for the simple reason that it will be easier for an NI business to sell to the UK than to sell into the Republic. If such a shift does happen – even if it is a small shift – then that further makes the economic case for unity substantially weaker, from the perspective of NI-based businesses.

Of course, the extent to which this really matters is debatable. Personally, I’ve never put much weight in the economic arguments, because this is a debate that is ultimately more about identity than economics. For example: If I told you, an Irish person, that Ireland’s GDP would increase by €1,500 per person over a decade if we just forgot about 1916 and all that, and rejoined the UK, would you take that deal?

Thought not. So having said that, it seems unlikely to me that any Unionists might be persuaded by economic growth arguments either.

But whether or not they ultimately matter in terms of votes, it still does seem to me that these arguments are the background noise of the campaign for Irish unity. A strong economic case helps whichever side has it sound more pragmatic, less threatening, and less ideological. Up until Monday, I’d have said Nationalists had a pretty strong argument to make on that front.

But if this new agreement is implemented, then the DUP can, I think, claim to have struck a solid blow against the economic case for a United Ireland.

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