As Theresa May gets desperate to find a way out Ireland is in danger of becoming collateral damage. The run up to the June summit will give us a clearer indication of the Northern Irish border's fate.
If the mere mention of the word Brexit makes your brain freeze and your eyes glaze over, then welcome to the club.
That's the effect it has on most of us. But that does not mean we can all forget about it, tempting though that might be.
It is now rapidly approaching crunch time on the problem, and still there is no deal in sight which would prevent Britain crashing out of the EU. We have already explained here why Brexit will create enormous difficulties for Ireland, because of our dependence on the U.K. market and the challenges posed by the possible return of a visible border between north and south.
If the U.K. does crash out without a deal -- the so-called hard Brexit -- the problems for Ireland will be magnified even more and could become catastrophic.
There were two developments last week which illustrate what a mess this whole business has become and how hopelessly divided the British themselves are on what to do. First, the EU rejected as inadequate the proposals the British have made so far on how a hard border in Ireland is to be avoided.
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You will remember that last December the British gave the EU an undertaking that they would find a solution to the Irish border problem, a guarantee which was required to allow the Brexit negotiations to move on to the critical talks about the future trading relationship between the U.K. and the EU.
To no one's surprise, the suggestions made by the British since December have failed to do this for the simple reason that there is no answer to the conundrum. You can't have an invisible border in Ireland and at the same time have Britain (including Northern Ireland) outside the EU Customs Union and Single Market making its own trade deals with the rest of the world.
UK to leave EU customs union after Brexit, confirms Theresa May. The UK Prime Minister have just told the Parliament 17 million voted to leave the EU, so there's no but's and If's we are leaving the lame duck federation called EU, end off pic.twitter.com/nSJMgb3qN4
— Eng. Carrusso (@EngCarrusso) April 25, 2018
As we have pointed out here before, it's a circle that cannot be squared no matter what kind of hopeful language you use. The proposals the British have made on how to achieve a frictionless border after Brexit are unconvincing, mainly relying on voluntary compliance by big businesses, the complete exemption of small businesses, and vague "new technology" to monitor cross-border trade invisibly. Essentially this would mean big businesses filling out their own duty payment forms, like they do their tax accounts, with spot checks to keep everyone in line. It would be open to all kinds of abuse, not just in non-payments but in the movement of disallowed goods, so the EU is not buying it.
The Irish border issue was supposed to be sorted out before the next summit of EU leaders which is in June. The rejection of the British proposals by the EU Commission officials last week has now put the cat amongst the pigeons. With this critical EU summit just weeks away, time is fast running out.
If the issue remains unresolved by then, the EU may well block not just any talks on future trade but the two-year transition deal that is supposed to ease the British exit. Resolving the Irish border was one of the three requirements laid down by the EU before any further progress can be made, leading British Prime Minister Theresa May last December to give an absolute guarantee that there would be no hard border in Ireland.
A Brexit solution for the Irish border may not come until 2021, David Davis says https://t.co/SRDw1haPuQ pic.twitter.com/qijBCez9LZ
— Bloomberg (@business) April 25, 2018
With that now in doubt and the British still trying to have their cake and eat it, the possibility of a hard Brexit is becoming more likely with every passing week. The second thing to happen last week was that the House of Lords -- the upper chamber in the British Parliament -- passed a vote which backed the idea that the U.K. should stay in a customs union with the EU after Brexit, something that May has ruled out.
This week there may be a similar vote in the House of Commons, with the remainers (those from all sides who opposed Brexit) lining up to further frustrate the government. All of which underlines the chaos and confusion there is on the British side as Brexit approaches.
To be fair to May and the British government, the problems posed by Brexit are endlessly complex and the Irish border question is far from being the only one. Even if May eventually agrees to stay in some version of the customs union to get over the border issue (and also keep British businesses happy), that is not the end of it. The EU Customs Union applies common tariffs on goods coming into the EU from the rest of the world and allows duty free trade within the EU between member countries. But it's not just a matter of tariffs and duty.
Read more: “No Irish Need Apply” to Northern Ireland border Brexit jobs
There are also the common standards and regulations that all businesses within the EU have to meet so that there is a level playing field for everyone -- the basis of the Single Market. And it's very difficult to have one without the other. For this reason, the British aim of maintaining most of the present free trade it has with the EU after Brexit implies not just staying in the Customs Union but in the Single Market as well. The British have suggested that they can get over this by mirroring EU standards and rules in the U.K. after Brexit (so-called regulatory alignment). But doing that would be very difficult if they are to be able to make the trade deals they want with the rest of the world.
All of this explains why after a hard Brexit, it would be the EU, not the U.K., which would want a hard border in Ireland. The EU would be concerned that a borderless Ireland might be used as a backdoor for cheap global products into the EU from the rest of the world via the U.K.
It's not just about the difference in prices; just as important would be the difference in standards and regulations. Hormone-raised beef and chlorine-washed chicken are just two items that are often mentioned here. But a vast number of products would be concerned, from pharmaceuticals to electrical goods, clothing and almost everything else you can imagine.
It has taken decades for the current standards to be agreed and established in legislation in the EU. Any variation from these standards in the U.K. in some post-Brexit deal with the EU would involve complicated and lengthy negotiations which might not succeed. It can take years to complete such agreements on trade. Regulatory alignment, part of the supposed answer to avoiding a hard border in Ireland, is therefore far from simple. It would also put severe limits on trade deals the U.K. might do with the rest of the world which would be unacceptable to the hard Brexiteers in May's government.
Already this week there has been strong push back from the hard Brexiteers to reports in the British media that May is getting ready to make some kind of proposal on staying in a customs union, if not the full EU Customs Union. May, who many Tories believe is at heart a remainer even though she has accepted the referendum vote to leave, has probably realized by now that she has been landed with a problem which has no solution.
And as she gets desperate to find a way out, the danger of Ireland becoming collateral damage is increasing all the time. The next few weeks in the run up to the June summit will give us a clearer indication of just how great that danger is.
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