Can Trade Invigorate Peace in Northern Ireland?
– Alex Katsomitros
Divided by religion and sectarianism, Northern Ireland pins its hopes on trading opportunities and a stronger economy for a less turbulent future.
On our way from Derry to her family’s farm in Strabane, I play a game with Anne Donnell-MacRury. “Where is the border?” Anne tells me we have crossed it a couple of times. Yet, I couldn’t have known.
Does it start at this gas station? Is this part of the road in Northern Ireland or the Republic of Ireland—“the South,” as most locals call it? And what about that small bridge? Did the commission that demarcated this unusually meandering border deem it important enough? It could have been a checkpoint, I think. Turns out it’s just a bridge.
Anne, an import from Scotland’s Hebrides islands, remembers one of the first times she visited her husband’s family farm in Strabane, a small town close to the border with the Republic of Ireland, 30 years ago. Her husband, Hall Donnell, a local Protestant, took her up on a hill and showed her the idyllic mist-covered, green landscape unfolding before their eyes. “He said, ‘It looks peaceful from up here, doesn’t it?’” Anne reminisces. “It was quite profound. And yet, it wasn’t peaceful when I first came. There was always that element of living on the edge, especially when crossing the border. You never knew what would happen.”
Their farm is indeed peaceful, surrounded by the endless greenery that makes the Irish landscape—North and South—so distinctive. Hall, a gentle figure speaking in a soft Northern Irish twang, is proud of his 110 cows. A third-generation farmer, he enthusiastically shows me the machinery that has rendered milking—previously a backbreaking manual job—speedy and automatic. There is jostling, mooing, and a bit of foul stench as cows patiently wait to offer their milk to the robot. It’s all part of the plan, Hall tells me, to make it easier for the next generation, their three sons, to take over.
Most of their milk goes to the local processing plant of Lakeland Dairies, an Irish co-op operating across the border; a part of the all-island supply chain that has flourished on the heels of the Good Friday Agreement, or GFA, the treaty that sealed a fragile peace between Catholics and Protestants in 1998. It is then sold farther afield, from inside Ireland to Japan and Africa, as a European Union product.
Making that invisible border visible again would have dramatic effects on trade, Anne says. “We are the sector that needs the North-South border more than any other sector. Thirty percent of the milk in Northern Ireland wouldn’t be processed, because it needs to cross that border. A normal farm would make a loss straightaway. How long do you wait until things get better and carry on feeding and milking the cows?”
A fragile peace
Since its creation in 1921, Northern Ireland has been a troubled place, divided between Catholics and Protestants. This is a community that lived and breathed identity politics long before the term had been invented. The conflict even spills over into names. Is its second-biggest city called Derry or Londonderry, as many Protestants still call it? As Anne tells me, while showing me the mural dedicated to the TV show “Derry Girls,” most locals prefer the short version. Even the region’s name is disputed. Some Protestants prefer the term “Ulster” while nationalist Catholics, hopeful for a future united island, prefer “the North of Ireland.”
But this is more than semantics. A period of violence from 1968 to 1998—the notorious “Troubles”—was fueled by weak economic ties and resulted in more than 3,000 people killed. The Good Friday Agreement, brokered by the US, put an end to paramilitary campaigns. But it has not brought an end to violence. A few weeks ago, just before the treaty’s 25th anniversary, a dissident Republican group attempted to assassinate a police officer—a reminder that the Troubles might be history, but this is still a troubled place. The UK’s intelligence service raised the terrorism threat level to “severe” in advance of a visit by President Biden, fearing that another attack was “highly likely.”
Since Brexit, Northern Ireland has outperformed the rest of the UK. Trade with 'the South' and the rest of the EU has boomed.
Yet the treaty has been a success, says Quintin Oliver, a social entrepreneur and veteran activist who led the “Yes” campaign in 1998. “As Clinton called it, it was an ‘act of genius’. It settled what globally was thought to be an intractable problem, because of the binary nature of the question ‘Are you Irish or British?’ And it solved it creatively—you can be British, Irish, or both.”
Then Brexit came, threatening to unravel many certainties. Although 56 percent of its population voted to stay, Northern Ireland had to leave the EU. Suddenly, the prospect of a physical border became real. The GFA provision that there would be no North-South border clashed with the inevitability of a UK-EU border. Recognizing that a land border could incite violence, the two governments and the EU came up with a middle-of-the-road solution: the “Northern Ireland Protocol,” as a part of the UK-EU Brexit deal. The Protocol effectively kept the region aligned with most EU trade rules, pushing the UK-EU border to the Irish Sea ports.
Inevitably, trade between Northern Ireland and the rest of the UK suffered. Confusion about who was responsible for customs declarations was an acute problem, says Stephen McAneney, founder of the customs clearance agency Allied Customs Services. The onus usually fell on Northern Irish firms, but they rarely had the know-how and resources to deal with complex paperwork. Many UK suppliers stopped distributing to the region. The UK set up a “trusted trader scheme” to reduce red tape, but this largely excluded small and medium-size enterprises, the backbone of the local economy.
It wouldn’t take long for the Protocol to turn into a political hot potato, with many Protestant Unionists fiercely opposing checks on goods. Boris Johnson’s government considered ripping up parts of the Protocol, making a hard border more likely. Trade became a symbolic battlefield: complex rules on the origins of sausages and potato seeds a metaphor for Northern Ireland’s political limbo. The Democratic Unionist Party, or DUP, withdrew from Stormont, the Northern Irish parliament, in protest against the Protocol, leaving the region without an executive. What drives resistance is the Protestant community’s growing insecurity, given that the 2021 census revealed that Protestants are for the first time a minority, says Feargal Cochrane, an expert on the region from Kent University’s Conflict Analysis Research Center.
Some small-to-medium size businesses recognize the benefits of Northern Ireland’s newly found trading mojo. One example is Lowden Guitars.
Smaller businesses were trapped in Northern Ireland’s idiosyncratic politics. A case in point is Environmental Street Furniture, or ESF, which designs benches, bus shelters, and other street furniture; they’re based in a village just outside of Belfast. Many of its UK suppliers refused to send materials, increasing the firm’s costs by 30 percent, just as its trade with Ireland boomed. From different Value Added Tax rules to arcane customs processes for goods that crossed the border several times, complexity rose significantly. The firm added an employee to its small team of 10 to deal with mounting red tape. Yet its managing director, Alan Lowry, is optimistic that better days are coming for an export-driven company like ESF. “We can have a free-trade zone with unfettered access to the UK, the EU, and the rest of the world,” he says. “We are ready for that.”
An economic Good Friday Agreement
The peace process may have brought an end to the conflict, but not all of its promises have been met. Northern Ireland remains poorer than the rest of the UK, while the Republic has transformed from one of the EU’s poorest members to the second-richest one within a few decades. A walk by Shankill Road, a Protestant enclave within the firmly Catholic West Belfast, is testament to Northern Ireland’s economic troubles. Although almost every other building is adorned with murals commemorating the Unionist cause, signs protesting the region’s housing crisis remind the visitor that the economy is a more urgent issue.
“During the conflict, we always argued that the economy would improve when we stopped fighting, but this hasn’t really happened,” says Quintin Oliver. “We need to build a stronger economy to offer people a realizable vision, and show to the two governments that this is not just an economic basket case that needs subsidy after subsidy.”
Ironically, the region’s geography could turn from a disadvantage into an opportunity. Since Brexit, Northern Ireland has outperformed the rest of the UK, despite the problems caused by the Protocol. Trade with “the South” and the rest of the EU has boomed. “Many businesses adjusted to the new rules and used that to their advantage. Northern Ireland was the least affected by Brexit because of the Protocol and the trade facilitation it created,” says Allied Customs Services’ Stephen McAneney. Some companies have even shifted their supply chains to the Republic.
Last February, the UK government agreed with the EU to an overhaul of the Protocol, dubbed “the Windsor Framework,” a move that was expected to render trade between Northern Ireland and Great Britain less burdensome. Goods staying in Northern Ireland will be processed in a way that is practically expedited compared to goods heading to the Republic that will go through full customs controls. The deal includes a clause, informally called “the Stormont brake,” that offers the UK a veto on the implementation of new EU rules on goods in Northern Ireland.
The British Prime Minister Rishi Sunak has claimed that his deal allows Northern Ireland to become “the world’s most exciting economic zone.” Some hope it may attract UK companies that want to continue exporting to the EU without friction. This is echoed by business leaders like Roger Pollen, head of the local Federation for Small Businesses, who argues that the deal, coupled with more investment, could transform Northern Ireland into a world-leading logistics hub—a “Singapore of the Western Hemisphere.” “We are a unique place with unique history and geography. If we can make that work to rebalance the disadvantages we had over decades, nobody would resent that,” Pollen says, adding that the framework could be an “economic Good Friday Agreement” that would allow businesses to be British, European, or both.
One obstacle is the DUP’s refusal to return to Stormont, although the Windsor Framework was ratified by the UK parliament. The party’s leader, Sir Jeffrey Donaldson, has raised concerns over the fact that the deal keeps some of the trade barriers intact. Polls reveal that a majority supports the Windsor Framework, including a significant fraction of the Protestant community. One reason could be that a stronger economy could ease tensions between the two communities, while making a reunification referendum less appealing, says Kent University’s Cochrane. “If the Windsor Framework put Northern Ireland into a stronger trading position globally, it would push a border poll further away.”
For its part, the business community is keeping a low profile; few companies have publicly supported the deal. Particularly the predominantly Protestant farming community, a legacy of the Plantation era, which faces a dilemma between its economic interests and Unionist allegiances. “In conflict-driven societies like ours, identity trumps everything,” Quintin Oliver says. “It’s a hot political issue, and they don’t want to be disowned by their family, neighbors, and politicians. The head is on the spreadsheet, but the heart says ‘I distrust you.’”
However, some small-to-medium size businesses recognize the benefits of Northern Ireland’s newly found trading mojo. One example is Lowden Guitars. Its small factory, located a few miles from Belfast, churns out some of the world’s best handmade acoustic guitars; Bruce Springsteen has one, and a partnership with Ed Sheeran has turned Lowden into a household name for guitar aficionados.
Brexit was a massive shock. “When we woke up in the morning and found out that we were leaving, we couldn’t believe it,” remembers George Lowden, the firm’s founder. Sending some of the company’s best guitars to Great Britain became extremely burdensome, with delays of up to 90 days. A hard border with the Republic would be equally problematic, given that some of the firm’s supplies come through the South. The Windsor Framework provides a window of opportunity, according to David Ausdahl II, the firm’s managing director. “We export so much, and so many of our goods are at risk. We bring [in] raw materials and export the finished product to the EU and Great Britain, so it seems that it [the Windsor Framework] will smooth things out.”
A Bangor native, George Lowden acknowledges that there have been bleaker times. “Back then you couldn’t walk about your hometown,” he says about the Troubles. “Bombs were going off on the street.” A free-trading Northern Ireland could leave uncertainty behind, with the two communities working together. “Hope transforms things,” he says.
Hope from across the Atlantic
The US looms large over Northern Ireland’s future, both as a menace and an opportunity. The appointment of Joe Kennedy III, a scion of the most prominent Irish-American family as US Special Envoy to Northern Ireland for Economic Affairs, has raised hopes that investment will be coming from the other side of the Atlantic. “[It will] open some doors. He is putting in a huge amount of energy and he is listening. There is a clear intent to foster trade relations from the top of the White House,” says Pollen. “If a US company wants access to both the UK and the EU markets, the most logical place to invest is Northern Ireland. We could trade out of our economic difficulties, and change so many of the other difficulties we face too.”
The Biden administration had warned the UK that any unilateral changes in the Protocol would hamper trade negotiations between the two countries, a blow to the UK’s pro-Brexit government that had invested political capital in a trade deal with the US. Now that the Windsor Framework has removed this obstacle, a trade deal seems more likely. For Northern Ireland, that could be a boon, a disaster or both. Local grass-fed meat and dairy could be sold as premium products in the US, says John McLenaghan, deputy president of the Ulster Farmers’ Union. But local farmers are also cautious, he adds, given the differences in production systems and standards: “Trade is not necessarily harmful, but it has to be done on a fair footing. Compared to the US agri-business, we are minuscule. If agricultural produce from the US was allowed into the UK, it could undercut our costs.”
Keeping the border invisible
For the time being, Northern Ireland seems to enjoy its day in the sun, politically in a precarious position, yet economically hopeful. “Some of the political advancements over the last decades have been underpinned by economic advancements,” says the Ulster Farmers’ Union representative John McLenaghan, citing the cross-border milk supply chain as an example. “It would be difficult to imagine how [the North-South border] could have been changed without dramatic consequences.”
The border may be invisible these days, but remains present in people’s minds. Hall Donnell remembers times before the Good Friday Agreement when there were frequent army checks on the border, especially following terrorist attacks. “There is always a fear of violence, because of the history,” says his wife, Anne Donnell-MacRury. “The people who thrive on that kind of thing, they are still around. They just haven’t had anything to do for the last twenty five years.”
A mixed couple, even today an oddity in Northern Ireland, Anne and Hall have witnessed the dividends of peace. Hall remembers a friend who used to work at his family’s farm who was shot in the head by paramilitaries. “Many people were killed that way. Not many local families were untouched,” he says. “But people forget about these things as time goes by.” He prefers to talk about the renewed interest of banks to invest in local farming and how this could make his own farm thrive. “Scotland would love to be in our position, having those opportunities,” he exclaims with enthusiasm.
“If people are happy and have money in their pockets, everything would be easier,” says Anne. “Most people want to move on and work with their neighbors. They don’t think about what’s their religion in every interaction they have. And that’s the way it should be.”
Alex Katsomitros is a Paris and London-based freelance journalist specializing in finance, technology, and trade.
Cover photo: Hall Donnell and Anne Donnell-MacRury on their dairy farm. Photo by Alex Katsomitros.