Brexit Britain: falling pound, border fears and a frightened workforce

A year after Britain voted to leave the EU the pound is at least ten percent weaker, the economy is shaky and may be headed for a downturn and Theresa May’s minority government is weak after losing its majority in parliament after June’s general election.

There’s also the worrying possibility that a hard border between Ireland and Northern Ireland could unravel the Good Friday Peace Agreement.

The uncertainty is infectious.

In her first policy position after the two year long Brexit negotiations started earlier this month, May set out her plan for the rights of the three million or so EU citizens living in the UK. They will only qualify for “settled” status after five consecutive years living in Britain.

But this has not gone far enough to reassure many EU officials including Guy Verhofstadt, the Brexit co-ordinator for the European Parliament.

Representatives of The3Million and I are worried that the UK is using EU citizens as bargaining chips. #Brexit https://t.co/8ityyMrlDf pic.twitter.com/bqdfTTpLtH

— Guy Verhofstadt (GuyVerhofstadt) June 28, 2017

EU citizens living in the UK fear the future

A report by the consultancy firm Deloitte released on June 27th suggests that 47 percent of highly skilled EU workers are now considering leaving Britain.

One of them is Joana Ferreira, a dentist who works in a private practice on the outskirts of London, and who arrived from Portugal four and a half years ago.

“I’m just worried about the living conditions, really,” said Ferreira. “Am I going to be able to work? Am I going to get a normal salary, like everyone? Am I going to be kicked out of the country? I don’t know, nobody knows!”

Joana and her husband have a three year old daughter who was born in Britain and they had planned for her to grow up in the country.

“I just feel very insecure of what’s going to happen in the future. I really want to know more so I can plan. Because at the moment, I cannot plan anything in my life,” she said.

Joana’s employer Smita Mehra, the managing director of The Neem Tree practice, is also worried as 60 percent of the staff at the four practices she manages are non-British EU nationals.

“We’ve been very privileged because there have been no barriers to recruitment and barriers to working laws or working conditions. Now if that were all to change it would produce uncertain times, and so I’m praying that things won’t change,” she said.

The UK’s construction sector is also vulnerable; the Royal Institution of Surveyors forecasts 176,500 construction workers or eight percent of the workforce is from the EU and it believes all those jobs could be lost if there is a hard Brexit.

Azad Azam runs a construction business in London and one third of his employees come from Eastern Europe. He says he’s already feeling the pressure: “The impact of that now is that we can’t increase our workforce the way we want to. If we put job vacancies adds in the British press, we get no response,” he said.

“Nobody wants to be electricians nowadays, nobody wants to be a carpenter.”

Azad recently had to turn down some of the biggest deals of his career – a 2.5 million pound construction contract for a series of luxury houses – because he couldn’t find the workforce required.

1/3 of non-British workers are considering leaving the UK, with highly skilled workers from the EU most likely to go https://t.co/l8IcwsF3W8— Open Britain (@Open_Britain) June 27, 2017

Is Ireland headed for trouble at the border?

Britain’s vote to leave the European Union has raised the stakes in the long and divisive dispute over Northern Ireland’s status.

Concerns that Brexit will lead to a hard border with EU member Ireland have reinvigorated Irish nationalism and its dream of a united Ireland free of British influence.

That in turn has unsettled unionists, who back British rule and fear their majority is slipping away in the region of 1.8 million people.

For some people in both communities, the idea of a new, rigid frontier with Ireland stirs painful memories of the British Army watchtowers and checkpoints that peppered the border during decades of sectarian violence that killed thousands.

The struggle between nationalists and unionists over whether Northern Ireland should unite with Ireland or remain part of the United Kingdom plunged the region into 30 years of violence from the late 1960s which saw 3,600 people killed.

A 1998 peace deal created a power-sharing government that has brought peace and relative prosperity, but has failed to heal the sectarian divide that still defines politics here.

In Clones, a border village in Ireland, checkpoints made border-crossing difficult during that time and Donald McDonald had to give up his family business, a textiles shop.

“I would not want to see us to return to this type of place, this type of barrier. For this, sense of hope and trust and relationships had been damaged by political decision of protectionism by the UK,” he said.

A nearby road bridge was closed by the British 76 times during The Troubles, despite the locals removing the barriers again and again.

The authorities are now considering a plan to establish truck checkpoints near here, leaving locals worried.

“I think that people would react in a way that would not be good for neither for the Good Friday Agreement, nor for the people or for the island as a whole,” McDonald said.

In Northern Ireland the unemployment rate was at thirty percent, but today it’s down to just three percent, which is how people want it to stay.

On the border with Ireland Conor Patterson, who works for the local chamber of commerce, has been handing out advice to the Brexit-troubled business community.

“This area has a history of violent challenge of the border as it is a barrier to the free movement of goods and people… And we have enough problems in Europe with radical young people – we do not need another problem of radicalisation,” he said.

“The risk is that dissident forces will radicalise people in the community, especially young impressionable people, and they may be attracted to an ideology that would be promote violent challenge of all of this. We do not want to go there – it is too big a threat.”

The Catholic Sinn Fein party is against Brexit and wants the reunification of the whole of Ireland, British north and Irish south. Its leader Gerry Adams has also warned that British Prime Minister Theresa May is jeopardising the Good Friday peace Agreement in Northern Ireland by entering into a parliamentary alliance with the Protestant DUP party to strengthen her minority government.

We told the British PM that her govt is in default of the Good Friday. It also needs to ensure that any arrangement with the DUP Is public pic.twitter.com/usdPwKPF8E— Gerry Adams (@GerryAdamsSF) June 15, 2017

The Protestant DUP party is firmly pro-Brexit and wants Northern Ireland to stay with the United Kingdom. May has also promised Northen Ireland’s devolved government one billion pounds’ worth of extra funding in exchange for agreeing to support her Conservative party in key parliamentary votes.

But one DUP MP, Sammy Wilson, played down fears that peace could be threatened by his party’s alliance with the government.

“The only risk to the peace process is the kind of hysteria which Sinn Fein are trying to generate for the moment for short term political gain – and they really ought to consider what the impact is on their own communities and on their hard men in their communities who will seek any excuse to go back to a terrorist campaign.”

We told the British PM that her govt is in default of the Good Friday. It also needs to ensure that any arrangement with the DUP Is public pic.twitter.com/usdPwKPF8E— Gerry Adams (@GerryAdamsSF) June 15, 2017

Even the prospect of lengthy traffic queues at the border as trucks go through customs is perfectly surmountable, MP Sammy Wilson said.

“One of the intelligent solutions is to use electronic surveillance of trade across the border, using vehicle recognition numbers. – You do not need border posts, you do not need to stop people and you will back up this with occasional physical checks if you felt that that is needed.”

It’s agriculture and the food industry that might suffer the most economic damage. Before the Brexit referendum the LacPatrick dairy company invested 45 million euros in a new plant in Northern Ireland producing milk powder for Africa and the Middle East, benefiting from current EU trade agreements.

The company has 1000 suppliers and three production sites, in both the north and the south. Its worst case scenario is the “no deal is better than a bad deal” rhetoric of British Prime Minister Theresa May before her government lost its parliamentary majority in elections in June.

“If there is not a free trade agreement on food and agriculture, between the EU and the United Kingdom, this raw material, this milk for instance, will be subjected to WTO tariffs which will be up to 50 percent of the value of the actual product, which will kill off all of this trading,” said Gabriel D’Arcy, the chief executive of LacPatrick.

At the pub in Rostrevor, a tiny Northern Ireland coastal village close to the border, there’s a sense of impending doom amongst the locals.

One of them, Sinn Fein party member Michael Gray-Sloan, fears that Northern Ireland will suffer most from leaving the EU. “I think Brexit is a disaster, politically, economically, socially – nobody knows what is ahead of us and the fact that English folks has dragged us out of the European Union is almost criminal, completely insane,” he said.

“Feeling part of Europe and being European is important to people here,” said another customer, Paddy McGuinness.

And a third was even more gloomy.

“If we have a hard Brexit and we have a border we are going back… The peace process will totally be undone…It is a nightmare. It does not bare thinking about,” said Deirdre Murphy.

“I am hoping that we get a soft, a very soft Brexit,” she added.

But that’s not what most analysts of European politics predict.

UK heading for “a fairly hard Brexit”

Sophie Claudet met the Director of the Centre for European Reform, Charles Grant, in the studio to discuss Brexit and how it could impact on both the peace deal in Northern Ireland and the border with Ireland.

Euronews – Sophie Claudet

Charles Grant, thanks for being with us. Now we’ve seen that Theresa May has put a new proposal on the table allowing EU citizens that have been living in the UK for five years to stay. Does it mean she is softening her stance somehow?

Charles Grant, Director of the Centre for European Reform

Her line is for a hard Brexit. The particular proposals she’s made on the rights of EU citizens in Britain were to be expected, they were roughly in line with what the EU thought would happen. It’s not enough for the EU, but as Angela Merkel said, it is a start and I think that they will negotiate on that basis. The gap between the two sides is not a million miles and I do think this will be one of the easier issues to resolve because on both sides, for the three million EU citizens living in Britain and the one or two million Brits living in the EU, there are such strong reasons to get the deal done, to reassure these people who are very, very nervous about their futures. So I would predict in a month or two there will be some resolution.

New #Parliament seems unlikely to pass the legislation required for a hard #Brexit https://t.co/BrImildp02 by CER_Grant pic.twitter.com/0yNs5IAezW

— CER (CER_EU) June 28, 2017

Sophie Claudet

Now, how about the UK’s grim looking economic forecast?

Charles Grant

The impact of the 15 percent devaluation of the pound is pushing inflation up, foreign investment is diminishing somewhat, there has been a lot of consumption driven by people spending but it cannot go on forever, and I think we are now expecting an economic downturn. And in particular, as the details emerge in the Brexit negotiations of the kind of relationship that we will have in future with the EU, less closely tied economically in the past, business confidence will suffer, that will affect consumer confidence, and I think there is a downturn coming. To what extent that leads public opinion to regret the decision to leave the EU is an open question.

Sophie Claudet

How do you see trade flows evolving between the EU and the UK and are we heading towards a hard or a soft Brexit?

Charles Grant

I think certainly we are heading for a fairly hard Brexit, but the general election result which has weakened Mrs May and strengthened the more moderate forces in parliament means it will be softer and more moderate than that she initially envisaged. We will certainly have fairly modest restrictions on immigration, we may be less dogmatic in rejecting a role for the European Court of Justice and we may perhaps stay in the EU custom’s union.”

Sophie Claudet

We’ve seen that Theresa May has offered more than one billion euros to Northern Ireland as part of her deal with the DUP (Democratic Unionist Party). Could separatists still push for reigniting Ireland?

Charles Grant

Because the DUP, which is one strong community in Northern Ireland, is now aligned with the British government, how can the British government play the role of being a neutral arbiter in the peace process in Northern Ireland which is still a problem, there are still many difficult issues to overcome in Northern Ireland. So it may perhaps strengthen feeling amongst the Catholics that staying in the UK is a bad deal, that they are not being well treated, that their enemies in the DUP are close to the British government now, so it could perhaps ignite some nationalist feeling. But as far as I can see, most people in the north of Ireland and indeed most people in the south, do not actually want a united Ireland at the moment. That would be a step too far for most of them and just too complicated at the current time.

Sophie Claudet

Do you think that as far as Northern Ireland and the Republic of Ireland are concerned, are we heading for a hard border or something in between?

Grant: If Britain leaves the EU customs union there will have to be customs controls on the borders between the EU and the UK, including between the north of Ireland and the south of Ireland, borders to check for duties being paid, for forms being filled in, for rules of origin to be respected.

Sophie Claudet

Do you think in the particular context of Ireland it could lead to renewed tension or even violence?

Charles Grant

Possibly yes, because if you have these customs controls going back to the border that will be a provocation to the extreme nationalists who will want a united Ireland. And if the border posts go up, I know there is a fear in Dublin that terrorists could burn them down or blow them up, which is a very strong reason not to have border posts, which is another reason for Britain to stay in a customs union with the EU. My friends in Dublin are very worried about Britain leaving the customs union because of the impact it could have on the peace process in Northern Ireland.

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