Brexit a ‘nightmare’ for Northern Irish business as MPs vote to remove Irish backstop from deal

Companies have stopped investing in favour of holding onto cash in case it's needed after the UK’s withdrawal from the EU

Businesses in Northern Ireland are growing increasingly concerned about Brexit and say they have been left in “limbo” by Westminster, with uncertainty on the rise just two months ahead of the UK’s departure from the EU.

MPs voted on Tuesday to remove the Irish backstop from Theresa May’s Brexit deal and find an alternative, as yet unknown, replacement.

Companies in Northern Ireland are “upset and confused” by the result of the votes, according to Stephen Kelly, chief executive of Manufacturing Northern Ireland, which represents 5,500 firms in the region.

“The government has given various commitments [to Northern Irish companies], it has to honour them, and ripping out the backstop doesn’t do this – so we are seeking clarity urgently,” he said.

“For very good reasons the backstop was included in the agreement. You can’t have an independent trade policy and not have a hard border in Ireland unless there are specific provisions for NI.”

The uncertainty is already having a huge impact on companies in Northern Ireland.

“I know a number of firms have been taking on agency workers instead of full-time staff so they have greater flexibility if it comes to a no-deal Brexit,” said Mr Kelly.

“So at a minimum, Brexit is making work short-term and tenuous.”

One business owner based in Northern Ireland, who did not want to be named, said Brexit was already creating problems with trade.

He told The Independent that a customer based in the Republic of Ireland had already stopped working with his firm “because they are scared about what will happen after Brexit”.

“We have customers asking us about what we are going to do and about our supply chains. It’s really, really difficult,” he said.

“It’s the uncertainty more than anything. Business does not like uncertainty and it’s creating havoc with us.”

Trading partners across Europe are nervous about the future, and investment at a standstill because of the uncertainty.

“We are holding back and keeping our cash because we many need it to get over the next few years,” the businessman said.

“It’s created a real issue for us going forward. We just don’t know what’s going to happen and we won’t be investing until we know what’s going to happen and until we know what happens with the customs union.

“If we get into the position where we can’t trade freely across the border our competitors in the rest of Europe will jump on that and take that trade away from us.”

He pointed out that if a deal is reached, there will still be two years of negotiations to get through. The alternative – a no-deal Brexit – is even more daunting.

“If we go into WTO rules, that’s going to create serious issues,” he said.

“Within Northern Ireland we will have a struggling economy in the UK on one side, the Republic of Ireland is going to have issues, and we will be left in the middle trying to trade. It’s a no-win situation.”

Meanwhile, firms feel like they have been somewhat abandoned by the UK government. Mr Kelly said that the government’s advice to business in Northern Ireland was essentially “not to do anything”.

“It’s 58 days to go – there’s food on the shelves that has a longer shelf life than that,” he added.

“The Irish government has been working with industries for the past two years. We have nothing, we’ve have been left hung out, hoping for the best. It’s unacceptable.”

The business owner told The Independent that communication from Westminster had been “very, very lacking”.

“The whole thing has been handled particularly badly,” he said. “We are in limbo, paddling away. We aren’t growing but we haven’t contracted, so that’s something – but that could change very quickly. It’s a nightmare.”