Sunday 8 December 2019

'Building bridges' is fine but we need North-South traffic

'I suspect that businesses south of the Boyne are still not looking north as much as they could'
'I suspect that businesses south of the Boyne are still not looking north as much as they could'
LONDON, ENGLAND - APRIL 09: (L-R) Irish President Michael D. Higgins and British Prime Minster David Cameron are seen during a meeting at 10 Downing Street on April 9, 2014 in London, England. This is the first official visit by the head of state of the Irish Republic to the United Kingdom. (Photo by Lefteris Pitarakis - Pool/Getty Images)
Richard Curran

Richard Curran

AS president Michael D Higgins enjoys the warm glow of the official state visit to London, the occasion does provide an opportunity to really move on from the difficult and thorny issues of the past between the two nations.

Yet, when it comes to business and trade links, the proverbial hatchet was actually buried many years ago. Irish companies have been exporting to the UK very successfully for decades. To put it in perspective, last year Ireland exported €14bn worth of goods to the UK. Add in service exports and nearly a quarter of our exports go to the UK.

In fact, back in the 1990s development agencies made a conscious effort to get Irish exporting companies to look further afield than just Britain because of the scale of dependence on it as an export market.

And when the British government provided a bilateral loan to the Irish State in 2011 as part of an international bailout, Ireland accounted for 7.5pc of UK exports. We are Britain's fifth largest trading partner. We buy more British goods than Brazil, India, China and Russia combined.

Joint British and Irish trade missions have already taken place and there are endless possibilities with where that commercial relationship can go.

The real unresolved and complex issue remains between the Republic of Ireland and our Northern neighbours up the road. That relationship still has a long way to evolve.

There is absolutely no doubt that the movement of people, goods and services across the Border has increased dramatically in the last 20 years since the first IRA ceasefire. Business links have improved significantly from simple trade, to tourism and cross-border shopping.

Intertrade Ireland has been very successful as a cross-border group whose sole aim is to encourage, inform and help finance, trade and business relationships on both sides of the Border. An all-island approach to marketing for tourism has also been very positive.

But despite progress, the North/South commercial links could be a lot bigger and better. There is no motorway, train or plane from Dublin to Derry – the second city of Northern Ireland.

Exports of goods (not including services) to the UK have grown by 100pc in the last 20 years to €14bn. But exports of goods to Northern Ireland have grown by 54pc in the same period to €1.4bn.

At 1.8 million people, the population of Northern Ireland is about 40pc that of the Republic, so it is a smaller end-consumer market.

However, there hasn't been quite the same growth as there might have been. In 2002, Intertrade Ireland and the ESRI did a very detailed survey of businesses on both sides of the Border. They found that a greater percentage of Northern-based firms (34pc) were exporting manufactured goods south, than the other way round.

However, they also found that a massive 63pc of businesses surveyed located less than 10 miles south of the Border were exporting to the North. The figure plummeted to just 39pc when that broadened to a 60-mile radius.

There does appear to have been a pattern that even during the worst years of the Troubles, southern businesses from Border counties were less troubled about entering the Northern Ireland market.

The late Eddie Haughey was from Louth but set up Norbrook Laboratories in Newry. Other businessmen from Border counties purchased or set up businesses north of the Border very early in their careers.

These include Martin Naughton, also from Louth, who set up Glen Dimplex in Newry. Larry Goodman did a lot of business in the North as did the Cavan-based Kingspan Group, which acquired businesses there decades ago.

In recent years a different dynamic has entered the North/South trade issue. Many large indigenous companies from the South have set up operations in the North where the cost base has remained cheaper.

Big Irish companies such as Kerry Group in the food sector have created employment in Northern Ireland and have invested heavily there.

Of the €1.6bn of goods imported from North to South last year, €934m was in food, drink and tobacco. Around €487m went the other way.

When it comes to shopping, southerners living in Border counties still shop a lot in Northern Ireland. Last year a survey found that nearly 50pc of cars in the car parks of Northern shopping centres in Border areas carried southern registration plates.

In the tourism stakes, northerners are making a bigger effort to come south than the other way round. This may have to do with GAA and rugby matches in Dublin. It could also be the larger selection of flight destinations from Dublin Airport than Belfast, in which case some of them are only going to the airport.

In 2000, northerners made 465,000 tourist trips south. Trips in the other direction were just 189,000.

In 2012, tourism visits from the North hit 1.2 million, but visits up North were just 430,000. So, trips in one direction nearly tripled in the 12 years, but only doubled when it came to southerners heading up North.

The same is not true when it comes to education. Incredibly, there were 3,520 full and part-time students from the South registered with northern third- level colleges in 2011, but just 738 northerners down here. We had twice as many students from Britain here as we did from the North.

You would have to suspect that a lot of those southern students in college up in the North are from Border counties and it is about geography and cultural ties.

The overall picture is one of an improving situation in business connections and trade.

Northerners are looking south in growing numbers but perhaps people and businesses from southern Border counties are contributing a disproportionately large amount when it comes to greater activity in the other direction.

I suspect that businesses south of the Boyne are still not looking north as much as they could.

It would be a pity if so much focus is paid on improving existing bridges between Dublin and London that the very process of constructing commercial, educational and cultural bridges on the island of Ireland itself got left behind.

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