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In risky move, UK signals it could scrap Northern Ireland trade rules

LONDON — The British government gave notice on Tuesday that it may unilaterally scrap some of the regulations that govern trade with Northern Ireland, a highly political move that puts Britain on a collision course with the European Union, 18 months after a trade deal that was intended to put out the last Brexit fires.

Foreign Secretary Liz Truss said a new bill would allow the UK government to control trade rules between mainland Britain and Northern Ireland, which had been painstakingly negotiated as part of a an agreement with Brussels.

“To respond to the very grave and serious situation in Northern Ireland, we are clear that action is needed,” Ms Truss told parliament. “We have to restore the balance in the agreement.”

Ms Truss insisted she wanted to amend rather than scrap the deal governing post-Brexit trade, known as the Northern Ireland Protocol. She also said the issues she addresses could be resolved through negotiations with the European Union rather than unilateral action.

But, if passed, such a law could tear up part of the trade deal with the European Union, establishing a new “green channel” that would remove checks on most goods moving from Britain to the UK. North Ireland.

These controls had been agreed to avoid disrupting trade between Northern Ireland, which is a member of the United Kingdom, and neighboring Ireland, which is part of the European Union, once Britain left the block.

In her statement, Ms Truss said the protocol had disrupted trade between mainland Britain and Northern Ireland. He is opposed by the territory’s Unionist parties, who favor keeping Northern Ireland as part of the United Kingdom, and complain that the rules are driving a wedge between the North and mainland Britain.

“Some companies have completely stopped trading,” Ms Truss said. “These practical issues have contributed to the impression that the East-West relationship has been undermined.”

The announcement poses multiple risks for Prime Minister Boris Johnson’s government: a potential trade war with the European Union, growing tensions with the United States, a possible break in the Western alliance in favor of Ukraine, and an uncertain impact on the politics of Northern Ireland itself.

Of these, a collision with Brussels would be by far the most serious, especially at a time when the UK economy is suffering from the surge in inflation that has plagued other countries due to food supply shocks. and fuel.

Bank of England Governor Andrew Bailey on Monday warned of an “apocalyptic” rise in food prices due to war-induced shortages of wheat and other crops in Ukraine. The central bank, he said, was “powerless” in the face of rising prices, with inflation expected to hit double digits by the end of the year.

If the European Union were to impose retaliatory tariffs on goods from Britain – a major ‘if’ – it would attach another dragging anchor to an economy that some analysts already say is at risk of tipping into recession. The combination of economic stagnation and soaring prices has stoked fears of a return to the dark days of the 1970s.

Then there is also the risk of upsetting relations with the Biden administration and Ireland’s advocates on Capitol Hill. The White House has warned Mr Johnson not to do anything that would jeopardize the Good Friday Agreement, the 1998 pact that ended decades of sectarian violence in the North.

Richard Neal, the powerful chairman of the House Ways and Means Committee, said any legislation that unilaterally repeals elements of the protocol would undermine efforts to negotiate trade rules “at an extremely fragile time”. He suggested Britain’s decision was politically motivated.

“Northern Ireland should not be held hostage in the political process,” Mr Neal said in a statement. “Rather, all parties must stay the course and continue to work together to find lasting solutions.”

Ms Truss has not published her new proposed legislation, the start of a long legislative process to make it law, and British officials say they hope talks with the European Union can continue in parallel, possibly ensuring that the laws are never used.

The proposed law would give the UK government unilateral powers over tax and grant policy in Northern Ireland. However, it is unclear to what extent the legislation could remove or limit the role of Europe’s highest court, the European Court of Justice, in settling trade disputes.

This would be seen by the European Union as a fundamental change to the protocol, rather than the kind of practical solution to border controls it is prepared to consider.

nytimes Gt

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