info@businessghana.com
IT MIGHT just be Ireland’s most famous product. And indeed, all of the Guinness that is drunk in the world is brewed at the St James’s Gate brewery in east Dublin. But the dark beer is then transported north, in tankers that have become known as “silver bullets”, to be canned and bottled in east Belfast before returning to Dublin for export. Diageo, the multinational company that owns Guinness, says that its silver bullets make some 13,000 border crossings a year. It estimates that even a short delay of 30 minutes to an hour for customs checks would add about €100 ($115) to the expense of each trip, costing the firm some €1.3m a year. If that happened, the price of Guinness might have to rise.
Guinness is not alone. The abolition of customs controls in 1993 and of security checks after the Good Friday Agreement in 1998 has led to the creation of what is in effect an all-island economy, with supply chains that criss-cross the border. Bilateral trade between Ireland and the United Kingdom is now worth over €1bn a week. Most of that trade goes over the Irish Sea, but a lot crosses the border with Northern Ireland, especially in the agri-food sector. The UK exports more food to Ireland than to China, Japan, Canada, Russia, Saudi Arabia and South Korea combined.
Thus, besides Guinness, the ingredients of Bailey’s Irish Cream, another drink owned by Diageo, are said to cross the border three times before being exported in bottles. Roughly a third of the milk from cows in Northern Ireland goes south for processing, while much of Ireland’s cheese goes in the opposite direction. Sheep and cows are frequently driven across the border for slaughtering. Economies of scale mean that it does not make sense to have two processing plants on the island for most foods.
Food and drink are among the most sensitive products in the EU. Michel Barnier, the European Commission’s Brexit negotiator, has said that after Brexit 100% of imports of animals and animal products will be subject to border controls. If a putative British free-trade deal with America ever came about, it might allow the import of chlorine-washed chicken and genetically modified foods. Given the public’s hostility to these, nobody in Brussels could risk letting them cross into the EU by the backdoor of the Irish border.
