Northern Ireland Economy is NOT outperforming the UK Economy

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We are grateful to our friends at Briefings for Britain for their permission to republish the following article

Northern Ireland Economy is NOT outperforming the UK Economy

“The Northern Ireland Protocol has now become the subject of a campaign of economic disinformation” according to Harry Western for Briefings for Britain.

Contrary to Remainer claims that the protocol was ‘shielding’ the Northern Ireland economy from the ‘downsides’ of Brexit, the evidence largely points in the opposite direction.

Protocol is hindering not helping NI Economy

CIBUK along with its affiliate Briefings for Britain – highlights the underperformance of the Northern Ireland economy in relation to the rest of the UK as a result of the Protocol.

Summary

1. Gross Value Added (GVA): the difference between a nation’s gross output and its net output.

2021 Q4 – 2022 – Q2:

• • • Northern Ireland: 5%
    • United Kingdom: 5%

2. PMI (Purchasing Managers’ Indices)

Source: Markit, Ulster Bank

• Northern Ireland private sector consistently underperforming that in the UK as a whole since the start of 2021, when the protocol came into force.

3. GB & NI Exports to the EU

• • • In the four quarters to June 2022, GB exports to the EU were 23% higher than in the four quarters to December 2020 (i.e. the period just before the protocol and TCA came in).
    • GB exports to the EU up 14% from Q4 2020 to Q2 2022
    • NI exports to the EU up just 8% for the same period

Source:  ONS

4. Employment in UK nations

Source: ONS labour force survey

• Up to the end of 2019, NI generated jobs at about the same rate as England or Wales and faster than Scotland.
• In the protocol period since the start of 2021, employment remains 4% below its 2019 peak unlike GB where employment is closer to full recovery.

OBSERVATIONS

What makes matters worse is the administrative burden associated with the Protocol. According to the Financial Secretary to the Treasury over than ten thousand traders have completed a million customs declarations thus far.

In addition, recent research has estimated that a fully-implemented protocol would in the long run increase the cost of GB imports in NI by 8% (a figure similar to estimates collected from individual businesses involved in NI trade) and lead to diversion of trade away from GB goods to more expensive ones sourced elsewhere.

According to the author, the overall effect of the Protocol

“is an unambiguous net economic negative for NI with the costs likely to rise steadily in the years ahead. As a result, it would be a huge error for the UK government to agree a deal with the EU on the protocol that leaves it substantially in place – as they now seem minded to do.”

A link to the full article can be found here