Brexit.

[Rossfan]

How have they been "sponsoring us for decades"??

Sorry,  should have been more specific, I was referring to that economic powerhouse of the north.

Indeed 

[seafoid]

The Tory leadership crisis reminds me of this

https://www.youtube.com/watch?v=uDT0xSsrVIg

furious MPs in Camp Johnson believe it was a long-planned stitchup by Gove and his advisers, after the justice secretary had his head turned during the EU referendum campaign by surveys suggesting he was the darling of the Tory membership. They also point to the public endorsement of Gove for prime minister by newspaper owner Rupert Murdoch at the Times media summit on Tuesday.

"Gove is a **** who set this up from the start," one friend of Johnson texted a political journalist at the Sun. More publicly, Jake Berry, Conservative MP and one of Johnson's closest allies, tweeted: "There is a very deep pit reserved in Hell for such as he. #Gove."

[seafoid]

George Carlin analysed the DUP a few years ago

https://www.youtube.com/watch?v=w85t5wxxamk

http://www.irishtimes.com/business/economy/brexit-northern-ireland-businesses-are-in-turmoil-over-uncertain-future-1.2705575
Brexit: Northern Ireland businesses are in turmoil over uncertain future

No one knows what the result will ultimately mean for firms in the province


Francess McDonnell   



 


Just 10 days ago Mike Thomson was happily converting Parisians to the delights of his Young Buck cheese and dreaming of a Northern Ireland victory at Euro 2016.

His small start-up, Mike's Fancy Cheese, based in Newtownards, Co Down, produces Northern Ireland's first raw-milk blue cheese.

A soccer fan, the young entrepreneur decided to combine his two passions and take Mike's Fancy Cheese on an impromptu trade mission to Paris and Lyons this month while supporting the Northern Ireland soccer team. He loaded up his van in Newtownards and off he went with relative ease to sell his creations, tariff-free, elsewhere in Europe.

Soccer and cheese proved a winning combination for Mike's Fancy Cheese before he had to rush home to "vote remain".

Although it is early days for the artisan producer, whose business is barely two years old, he is attracting the right kind of following among consumers, award-wining chefs and specialist retailers. He already sells into southern France which helped to whet his export appetite and, with his Euro 2016 dream over, Mike's Fancy Cheese is firmly focused on expansion.

However, in the not too distant future, managing those exports may not be as easy as simply loading up the van and heading off to France. Like thousands of other businesspeople in the North, Thomson is wondering just how the Brexit decision will affect his future.

Although the majority of people here voted to remain part of the EU in the referendum – 56 per cent to 44 per cent – that failed to make a dent in the overall UK Leave vote which was carried by a margin of almost 52 per cent to 48 per cent.

The result, according to Ann McGregor, chief executive of the Northern Ireland Chamber Commerce and Industry, has the potential to create more shock waves in the North than, for example, in Scotland which also voted to remain part of the EU.

Unique position

"Northern Ireland is now in a unique position as the only part of the UK with a land Border with the EU and this will throw up challenges," she says.

The chamber's own pre-Brexit poll showed that 74 per cent of its members intended to vote to remain. The business body has highlighted that cross-Border trade in manufacturing alone is worth €3.1 billion (€1.75 billion North to South and €1.3 billion South to North).

Furthermore, some 14 million people cross what has been effectively an invisible Border from Newry and Dundalk every year.

What might happen if the EU were to dictate that the Border were no longer invisible?

McGregor believes any "physical Border" would adversely affect the North's economy and potentially the Republic's, and it would be a major concern for local businesses.

The weak pound might deliver a welcome boost for businesses exporting into the South in the short term but the longer-term prospects are decidedly less favourable.

Dagmar Schiek, a professor in the School of Law at Queen's University Belfast and director of the Centre of European and Transnational Legal Studies, has said that in the absence of specific new agreements between the UK and the EU, the day-to-day life "around a shared Border will become very complicated".

Schiek says this raises key issues for Northern Ireland, including the prospect of Border controls and questions over the rights of "Border workers" and whether they would enjoy equal treatment North and South.

One of the fundamental worries for many businesses in the North is the fact that their biggest export market is on their doorstep. Latest figures from the HM Revenue & Customs show that the Republic was the North's biggest export market by far last year – worth £2.1 billion in the year up to the first quarter of 2016.

For companies like Derry-based Diamond Corrugated, which exports more than 60 per cent of its product across the Border, the question of what happens after Brexit needs to be answered quickly.

Paul Diamond, managing director of the firm, which celebrates its 40th year in business this year, says companies are engulfed in uncertainty following the UK vote to leave the EU.

Four months ago the family owned company, which employs 70 people, announced a £5.8 million investment that is expected to create an additional 19 jobs. The firm invested in high-definition flexo print technology to help it compete for new business in export markets, particularly among suppliers to multinational retailers.

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Diamond is confident that it is an investment that will pay off but he would like an indication of what may be around the corner.

"Businesses don't like uncertainty. We need the British government to successfully negotiate an agreement to have access to the European single market. It is particularly important for companies in Northern Ireland because of our land border with the Republic of Ireland," Diamond says.

He believes it is critical that the status quo of the current Border arrangement on the island is maintained.

"It is crucial that we don't have a physical Border, not least because it would slow down business by slowing down our vehicles. But we also don't want a digital border which would require customs clearance and a level of red tape that would be totally unnecessary," he says.

"There is a great deal of anger, disappointment and frustration over Brexit in this area. In this Foyle constituency, almost 80 per cent of people voted to remain in the EU. We recognise that the EU has been very good for the North of Ireland."

Key arguments

One of the key arguments in the Leave campaign was the amount of money the UK would save in the event of a Brexit. In 2015, the UK government paid just under £13 billion – or £35.6 million a day – to the EU budget.

According to Alan Werlau, UK investment strategist with Davy Private Clients, if you broke it down, the equivalent Northern Ireland portion of the overall UK payment to the EU worked out at about £374 million.

Under Werlau's analysis, the estimated EU spend in the North – from EU Programmes – was £404 million. On top of that, there were additional payments, for example for research projects, which means Northern Ireland's net benefit last year could have been between £46 million and £80 million.

One key advantage of EU membership for the North, he said, was that EU funding was in many cases matched by further funding from the UK government or helped unlock co-investment from private and public sources in the North.

"If we look at the Rural Development Programme, €228 million from the EU unlocked a further €316 million of national co-funding plus an additional €216 million in national funding top-ups. That meant a total of €760 million for Northern Ireland, which is equivalent to a multiplier of 2.33 times," he said.

"Another example is the Peace IV programme where the EU contribution of €229 million was supplemented by €41 million of other funding."

Support for farmers is, of course, one of the single biggest direct influences of the EU in the local economy. Common Agricultural Policy payments to farmers in the North were scheduled to be worth more than £2.3 billion between 2014 and 2020.

Now one of the big questions is how will the funding gaps Brexit will inevitably create on the ground will be filled.

Will the UK government step into the frame?

Public spending

According to the UK treasury, the Northern Ireland Executive's block grant – the budget it receives each year – will be more than £11 billion by 2019-20.

But under the system used to calculate public spending levels in Scotland, Wales and Northern Ireland, known as the Barnett formula, public spending per head in the North is running at 25 per cent above the UK average.

London's stance this week on how much it will cost the North to introduce lower rates of corporation tax may set the tone for future negotiations when it comes to Northern Ireland's critical financial lifeline with the UK treasury.

The North wants to introduce a new rate of corporation tax at 12.5 per cent in April 2018. The UK treasury says the block grant will be adjusted as a result – potentially by £275 million – in the years 2020 and 2021 to reflect the corporation tax revenues "forgone by the UK government due to both direct and behavioural effects".

The final amount has not yet been decided, but earlier this week Northern Ireland's First Minister Arlene Foster said she wanted to discuss with the treasury whether one of the benefits of Brexit would be a reduction in the cost of introducing the lower rate for the North as the UK would no longer have to comply with EU legislation on state aid to businesses.

However, Secretary of State for Northern Ireland Theresa Villiers has said, regardless of Brexit, the treasury will not consider making further reductions on the overall cost to the North of corporation tax. This has caused more than a ripple of concern among local business leaders and politicians.

The Executive hopes a lower rate of corporation tax will attract new investors which will in turn create thousands of additional jobs. But Esmond Birnie, PricewaterhouseCoopers' chief economist in Northern Ireland, says Brexit will undoubtedly affect the corporate tax system across the UK, raising new questions about the North's ambitions when it comes to what lower corporation tax could deliver for the local economy.

"When the UK has formally left the EU, the fundamental freedoms enshrined in EU treaties will no longer have effect and EU directives and EU case law will not be relevant to UK corporation tax," Birnie said.

"Neither will the UK government need to ensure that corporation tax legislation permits freedom of establishment in other EU member states. Depending on the exit negotiations, it may feel freer to implement measures to attract foreign investment as part of a 'UK open for business' initiative.

"What that means for Northern Ireland's proposed corporation tax reduction in 2018 is also unclear.

"With the UK presumably beyond the remit of the European Court of Justice (ECJ), the Azores judgment could cease to apply, thus negating the need for the UK government to withhold the cost of reducing corporation tax from Northern Ireland's block grant.

"However, that infers a level of generosity towards the North that Westminster may find unaffordable – or inconvenient."

One of Northern Ireland's key selling points to potential inward investors in the past has been its "competitive near-shore position to Europe" and the opportunity to take advantage of "tariff-free access to the world's largest consumer market of over 500 million people".

That may still be true today but it is anyone's guess what this proposition will look like in two years' time.

For now existing inward investors, such as the US-owned Concentrix which plans to grow its local workforce to 1,600, are watching and waiting.

Belfast-born Philip Cassidy, Concentrix's senior vice-president, says: "The uncertainty surrounding the decision to leave the European Union was anticipated by Concentrix, and we have been working with our clients and employees, both in Belfast and across Europe, to ensure that everyone is well informed of the situation and any developments. As the government has made clear, the circumstances of European citizens living and working in the UK will not change, and we are ensuring that all our staff are aware of this point.

Economic shocks

"We are reaching out to our political leaders, in both Stormont and Westminster, to ensure that the key issues and policies affecting the company are known and considered as part of the upcoming negotiations. While the re-negotiation may take up to two years, Concentrix remains committed to Belfast, our clients and employees."

Other local commentators are somewhat more blunt on the impact of the referendum outcome.

"A Brexit was never the preferred choice of the business community in Northern Ireland," said Angela McGowan, Danske Bank Northern Ireland's chief economist. "Clearly firms detest heightened uncertainty and economic shocks.

"It is disappointing that this setback has occurred at a time when the Northern Ireland economy was building up a solid recovery from the 2008-2013 recession but nevertheless we have to focus on the fact that there is going to be a period of adjustment . Northern Ireland companies are resilient and have survived plenty of adversity in the past."

She said the depreciation of sterling could in theory support external trade "but we have to remember that manufacturers are simultaneously facing rising import costs and are worried about future trade relationships".

Danske Bank says it expects the euro/sterling exchange rate to rise sharply to 0.85-0.90 over the coming months with elevated volatility.

"This could present some short-term opportunities for RoI [Republic of Ireland] trade for Northern Ireland's retailers and our local hospitality sector," says McGowan. "However, we also have to be realistic about the dent that Brexit could potentially have on domestic demand.

"This is just the beginning of a new chapter and there will undoubtedly be more changes ahead in terms of interest rates, funding streams, inflation and investment patterns."

[johnneycool]

Arlene and Co have no post Brexit strategy for the North, other than to keep spewing the Union will be stronger line as they're hanging off the coattails of Westminster as they've been doing for years.

The crumbs from the Westminster table could well be drying up as the Torys will prioritise regions they need votes from and Norn Iron isn't one of them!

[armaghniac]

I think the DUP have royally screwed up here, I don't think Robbo  would have allowed this to get so far. You now have a situation where businesses in Newtownards are looking to SF to save them! Strange times indeed.

[No wides]

The more this goes on, the more I am convinced brexit will NEVER happen, they may well be a recession but either a general election or a second referendum will make sense prevail, Britain needs to be in the single market and no way are they going to be without accepting free movement of people, can't see that happening and a Norway style situation.

[seafoid]

The more this goes on, the more I am convinced brexit will NEVER happen, they may well be a recession but either a general election or a second referendum will make sense prevail, Britain needs to be in the single market and no way are they going to be without accepting free movement of people, can't see that happening and a Norway style situation.

I agree. the costs are too high. Free movement of people isn't the problem anyway. The collapse of Thatcherism is the issue.
Immigration didn't destroy the north of England.

https://www.youtube.com/watch?v=37Cmzvt549Y

[seafoid]

https://www.theguardian.com/uk/2010/jul/12/laura-barton-wigan-southerner

[seafoid]

http://www.ft.com/cms/s/0/5f61e16c-2d59-11e6-a18d-a96ab29e3c95.html


For those in Shirebrook, who swapped a mine that provided quite rewarding jobs until it closed in 1993 for a warehouse that employs outsiders on low wages, the gains are less obvious. Sports Direct employs people — but not the same ones and not at the same rate. It is now hard to find a good job if your education is limited to school.

Very few consumers delve deeply into low prices — one survey by Morgan Stanley found that shoppers rated "good ethical credentials" as the 10th most important factor in choosing a retailer. But shoppers are also citizens and workers and they behave differently in these roles. The referendum offers a veto on how Sports Direct produces such value. Many will exercise it.

[screenexile]

We have it lads chill out. . .

http://thebrexitplan.com/

[Bazil Douglas]

We have it lads chill out. . .

http://thebrexitplan.com/

Reminds me of that song, My elusive dreams.

[armaghniac]

The more this goes on, the more the DUP claim on the political Darwin awards is secure
http://www.belfasttelegraph.co.uk/opinion/letters/dup-and-tuv-have-betrayed-scottish-unionists-and-probably-killed-the-thing-they-claim-to-love-34843777.html

[Rossfan]

Fair play to them if they're upsetting a bolx like that anyway

[seafoid]

https://www.tuc.org.uk/sites/default/files/tucfiles/TheGreatWagesGrab.pdf

[omagh_gael]

Interview with Michael Gove by Slugger a number of years ago on his views on Unionism in Ireland.

https://web.archive.org/web/20030409072410/http://www.sluggerotoole.com/home/archives/001059.asp