Northern Ireland “gains” from EU access under the Windsor Framework, but the whole of the UK will “have to deal with the consequences” of US tariffs, Hilary Benn has said.
Conservative former Northern Ireland secretary Sir Julian Smith said the Windsor Framework arrangements give the region “a unique competitive advantage”, while TUV leader Jim Allister claimed Northern Ireland may be “used as a conduit” by the EU to export goods to the US.
President Donald Trump implemented a 10% tariff on the UK and a 20% tariff on the European Union as part of a slate of international measures on what he deemed “liberation day”.
The leaders of EU countries are due to vote on a package of counter-measures responding to US tariffs on steel and aluminium already in effect.
If the EU decides to impose retaliatory tariffs on goods imported from the US, they would apply in Northern Ireland as the region continues to follow the EU’s rules in some areas of trading due to the Windsor Framework.
On Tuesday, the Northern Ireland Secretary said only 2% of imports to Northern Ireland come from the US, equivalent to about £800 million.
Mr Benn stated that businesses who lost out as a result would be able to claim the disparity in levy back from the duty reimbursement scheme – if the goods have not entered the EU first – and the custom duty waiver scheme.
In the House of Commons, he told MPs: “Tariffs are not good news for anyone, and no-one wants a trade war.
“The Government is doing everything possible to keep Britain secure during this new era of global instability, and it will always act in the best interests of businesses in Northern Ireland.”
He added: “HMRC is continuing to talk to and support any businesses that might be affected to help them understand how to use the duty reimbursement and customs duty waiver schemes.”
Later in response to DUP MP Carla Lockhart (Upper Bann), he stated: “Northern Ireland gains from the Windsor Framework because of its access – it does gain from its access to the EU market, other parts of Great Britain do not enjoy.
“But there is a consequence, which is what we’re discussing in relation to the imposition of tariffs by the United States of America, which is a decision that the US administration has taken and all of us are going to have to deal with the consequences.”
As Northern Ireland secretary from 2019 to 2020, Sir Julian helped negotiated the “New Decade, New Approach” that triggered the return of powersharing in after a three-year suspension.
He said the “2019 Brexit deal and the Windsor Framework give Northern Ireland a unique competitive advantage – 10% exports and access to the single market”, and asked for a “rapid automatic reimbursement scheme” for tariffs paid by NI businesses.
Mr Benn replied: “Rapid automatic doesn’t quite square with the need for the businesses in Northern Ireland that are importing American goods in the eventuality of EU retaliatory tariffs because they do have to demonstrate that they’re not then moving on to the European Union, and that does require them to provide evidence to HMRC in order to get the tariff reimbursed.”
Mr Allister asked Mr Benn if he was “embarrassed that he and his Government have no control over the tariffs in respect of goods imported into Northern Ireland”.
He continued: “Isn’t the obvious and inevitable answer to repatriate to the United Kingdom control over trade laws?
“And what happens if Northern Ireland is used as a conduit by the Republic of Ireland or the EU to export goods to the US? Who checks those goods and where?”
DUP MP Jim Shannon (Strangford) said: “The promise was made to Northern Ireland MPs that we would not be disadvantaged by any EU retentions. This is clearly not to be the case.”
Mr Benn reiterated that the Windsor Framework “brings benefits” to businesses in Northern Ireland.
He added: “The single most important reason for sticking with the implementation of the Windsor Framework is we want to negotiate closer economic relationships with the European Union, including a SPS (sanitary and phytosanitary) and a veterinary agreement.
“And members from Northern Ireland have on many occasions raised the consequences of the current arrangement. Things could be a lot easier if we get that agreement.
“But as I have pointed out to the House many times before, if we do not honour the last agreement that the United Kingdom as a country signed by the last government with the European Union, how exactly do we expect to get a new agreement?”
