Dr. Pat Ivory:

With regard to the protocol and the four-year review, it is important that the protocol is given time to be fully implemented and that the value of the implementation of the protocol is properly appreciated. This is something we want to continue to highlight. It is just over a month since we had implementation of the protocol and the trade and co-operation agreement. It is too early to do any assessment as to the full impact of either of the agreements. I understand completely the concerns the Chair has raised and it is important that business highlights where the protocol is delivering for the shared island economy.

In that context we mentioned dairy processing, drinks processing and the trade area. We have also mentioned the Manufacturing Northern Ireland survey and the views of the manufacturing sector in Northern Ireland. IBEC will continue to work with our partners, CBI Northern Ireland, to ensure that, from a business perspective, we are not found wanting in terms of highlighting what the protocol actually delivers for business, for workers and for consumers on the shared island.

The rules of origin area is a real challenge and a bigger one than anybody could have completely planned for. We only saw the full details of the agreement at the end of December. The impact of the rules of origin on trade which moves through the UK is complex. The customs procedures of getting over a product not being seen as entering and having free circulation in the British market, and therefore being subject to tariffs, are quite costly and complex. This is an issue which is not yet resolved.

There has been some progress in terms of some good guidance and clarification from the European Commission, DG TAXUD, Directorate-General for Taxation and Customs Union and the Revenue Commissioners. We are still assessing the costs and complexities of this, however. There is the reality that, in some instances, businesses will take other options and may look at direct routes. They may look at avoiding the kind of customs procedures and rules of origin that arise by transporting their product direct from continental Europe to Ireland, such as using the Rosslare-Dunkirk route for example.

It is a highly technical and challenging issue. We continue to be concerned and work hard on it. We continue to have discussions with the Department of Enterprise, Trade and Employment on particular sectors, such as the bread bakers sector and the impact of rules of origin for it and whether some level of grace period or derogation could be given to sectors to look at other options, supply chains, etc.

There is the increased cost of transport. It is clear that this was an issue for which companies prepared. We know a number of our members put substantial budgets in place to deal with the increased costs of customs and transport. Equally we know that, for SMEs in particular, these costs will be more difficult to overcome. It is early days. Hopefully, as the systems become smoother and some of the problems of the early weeks are ironed out, some of the costs of meeting the customs procedures, as well as the transfer costs involved, will actually decline and there will be a smoother movement of trade to our ports.

I would not like, however, to give the impression that after one month we are there. We are not. This is going to be a long year in addressing both the issues on the import side and then, from April and July, the export side. There is a lot more work to be done.