There has been significant fresh international focus on Northern Ireland in the years following the 2016 Brexit referendum. While much of this has dwelt on the uncertainty surrounding the UK’s departure from the EU, the narrative might now be shifting in a more positive direction, as Northern Ireland seeks to position itself more prominently on the global map.
In April, US President Joe Biden paid a landmark visit to the country which, in turn, led to a major investment summit in Belfast in recent days. Among the key delegates was Washington’s envoy to Northern Ireland, Joe Kennedy III, the grandnephew of former US President John F. Kennedy and grandson of Bobby Kennedy. He also plans to lead a US trade delegation to the country next month.
The US, one of the largest sources of foreign investment in Northern Ireland, has channeled £1.5 billion ($1.9 billion) into the country’s economy over the last decade, creating 13,000 jobs. About 1,000 US-owned businesses operate in the country, and in 2022, companies in Northern Ireland exported goods worth more than £1 billion to the US.
One of the most striking speeches during the summit was given on Wednesday by UK government minister Michael Gove, who asserted that Northern Ireland can be to the UK and Europe what Hong Kong is to East Asia. It is an interesting vision that stems, in large part, from the unique position of the country, post-Brexit.
Gove said: “Northern Ireland is on the cusp of one of the most exciting periods in its history. Nowhere else in Europe has unfettered access to the UK’s own internal market and the EU’s single market as well. Nowhere else has that potential for growth.”
To be sure, there are many differences between Northern Ireland and the “Asian tiger,” Hong Kong, not least given the more than 6,000 miles that separate them. What Gove was alluding to, specifically, is the fact that before Brexit, all of the UK nations — England, Scotland, Wales and Northern Ireland — enjoyed unfettered access to the European single market.
Now, because of special rules governing its border with EU member the Republic of Ireland, Northern Ireland is the only part of the UK to retain that access post-Brexit, while also maintaining its place within the UK marketplace as well.
This unique trading position is enshrined under the EU-UK Windsor Framework, which offers Northern Ireland a potential competitive advantage in comparison with other European nations.
This economic position might prove attractive to a significant number of international businesses, and not only to those in Europe. About 200 investors from around the world, including the US, the Middle East and the Asia Pacific region, attended the investment summit.
Whether or not Northern Ireland is able to develop into something that is even close to a European version of Hong Kong remains to be seen but it is a vision that might be attractive to some. Hong Kong, of course, was originally a sparsely populated area of mostly farming and fishing villages, yet it rose to become one of the most significant financial centers and commercial ports in the world, now with a population of more than 7 million.
This economic transformation was fueled by its status as an entrepot in East Asia, similar to Singapore in Southeast Asia. Hong Kong is too small to have an abundance of natural resources, so positioning itself as a trading center became a valuable economic strategy.
Northern Ireland’s history is very different, of course. It was created in 1921 when Ireland was partitioned and a devolved government was established, as part of the UK, for the six northeastern counties.
The economy of Northern Ireland was the most industrialized in Ireland at the time of partition but began to decline. However, it has grown significantly since the late 1990s, leading to greater prosperity for the population of almost 2 million. This has been driven, in part, by a “peace dividend” since the signing of the Good Friday agreement in 1998, which effectively ended the sectarian violence in the country, resulting in a significant increase in tourism, investment and business activity.
Now, Northern Ireland is one of the most cost-competitive places in Europe to do business. In 2020, it attracted almost £20 billion in inward investment, with a growing number of companies from around the world recognizing the growth potential, talent and expertise it offers.
One of the biggest keys to Northern Ireland’s future economic success will be politics. Although UK legislators signed off on the Windsor Framework, it is proving less popular among members of the unionist community in Northern Ireland, who favor the continuation of strong political bonds with the rest of the UK. This has resulted in the collapse of Northern Ireland’s power-sharing administration. It fell apart last year when one of the biggest political parties, the Democratic Unionist Party, withdrew as part of a protest against the Windsor Framework’s post-Brexit trade rules for the country.
There are several key issues at the heart of the revised pact, including physical controls and checks on trade to Northern Ireland from England, Scotland and Wales. The majority of controls and checks will disappear on goods destined to remain in Northern Ireland.
But the DUP, who were pro-Brexit, asserts that it will continue to block any restoration of the government in Northern Ireland, in part because the Windsor deal still requires EU checks on certain goods being shipped from England, Scotland and Wales for sale within the UK. The DUP fears that, over time, this will erode Northern Ireland’s ties with the UK.
If the country is to realize its significant economic potential, it must benefit from the clarity of a long-term, stable approach, as was so successfully the case after the Good Friday peace agreement a quarter of a century ago. With such an approach in place, the economic future could be very bright for Northern Ireland in the years to come.