No Goodbye COVID-19 just yet ….. but hello Brexit

1601

At the moment we seem to be winning the COVID-19 battle, but it still rages on around the world, there is no room for complacency as we prepare to welcome another, unwelcome visitor that is Brexit. Aidan Flynn, General Manager, Freight Transport Association Ireland (FTAI) comments.  

The Irish economy is opening back up again with restrictions easing and the number of new COVID-9 relates cases seemingly under control. The news is not so good on a global scale, however. Within the last week we have seen a record number of new cases internationally and the re-emergence of the virus in some American States. This has consequences for the International Supply Chain, and it is necessary that we in Ireland err on the side of caution when considering social activities, travelling abroad and continue to adhere to the social distancing, cough etiquette and hand washing regime. The resumption of services must be sustainable and each of us has a responsibility to ensure that is the case.

As we hurtle into the middle of Summer the news in the past week returned to Brexit. To clarify, Brexit has happened, Ireland is now in the process of agreeing the future trading arrangement between the EU and the UK. The future trading relationship is shaped by the negotiations that are ongoing. We hope that a comprehensive free trade agreement will be agreed in principle by October 2020 as this is the only way to ensure that goods can flow freely without delays, additional costs and administrative red tape between the two blocks. Based on publicised synopses of the negotiations thus far it seems that a comprehensive free trade agreement is quite unlikely. If progress is to be made however, the fact is that there will be a considerable shift in how we trade with our closest neighbour. Red tape, increased documentary requirements and the administrative burden across the supply chain will have a significant impact and require a period for industry to get up to speed on the new requirements.

There are just over 18,000 vehicles listed on the road transport operator licence database in Ireland. There are 3,834 international and national haulage licences in operation (average fleet size is 4.7 vehicles per fleet). Of that 12,600 vehicles (2,351 operators) are registered as International haulage operations. Ireland’s geographic location means that we are reliant on a number of modes of transport to feed our supply chain namely, road freight, shipping and aviation. These sectors are critical for the country’s economic activity and its connectivity to the rest of the world. The majority of freight in Ireland is transported via road. Indeed two thirds of all freight in Europe is transported by road. In 2016, Irish registered goods vehicles made 12.1 million laden journeys and transported a total of 141.7 million tonnes of freight. Most export and import freight is transited via Ireland’s ports either as road freight (RoRo – Roll-on/Roll-off) or as container freight (LoLo – Lift-on/Lift-off). Dublin is Ireland’s largest port handling 44% of the total tonnage of goods traded. Since the start of the so called ‘transition period’ (and pre- COVID-19) there has been very little Brexit preparation activity between stakeholders and Government agencies. It hasn’t been helped by the political situation and the fact that the new Government was formed 140 days after the election in February.  This needs to change!

The programme for Government states that the newly formed Government will prioritise in the negotiations ‘Having ambitious transport connectivity, including aviation and road haulage rights’. This is very important in the context that our international haulage sector and the industries they serve are reliant on the ‘Great Britain Landbridge’ for both import and export activity between Ireland and continental Europe. The IMDO report ‘the implications of Brexit on the use of The Landbridge’  highlights that the Landbridge works for time sensitive products such as those in the agri-food sector and Irish trucks transit 3 million tonnes (approx. €21 billion of imports and export) of goods to and from continental Europe via the Landbridge each year (84% of Landbridge activity is via Dublin port).

If we cannot come to a deal with the UK then accessibility to the UK market will be restricted for commercial vehicles as we will default to an ECMT permit regime that would only cover one third of our current requirements. To transit Great Britain would require adhering to the common transit convention that requires bonds, additional checks at borders, sealed containers that will inevitably result in delays. All of these issues must become a focus for the Irish Government in assisting industry prepare more vigorously for the 31st of December 2020 ending of the transition period.

The Programme for Government highlights the following Brexit Preparation points:

  • Work with all sectors, to ensure they are prepared for all possible outcomes. The Government will prioritise supports for vulnerable sectors, in the context of no trade deal.
  • Continue to ensure that systems at Dublin and Rosslare Ports and at Dublin Airport are Brexit-ready and adapted to take account of COVID-19.
  • Work to ensure that the essential UK Landbridge remains a viable and efficient route to market for Irish goods.
  • Constantly engage with stakeholder
  • All of these points are laudable and of good intent. The fact remains however that they need to be followed through on. It is welcome news that Government are to approve a major Brexit readiness plan. The details of this plan need to be assessed by industry to measure it appropriateness and the implementation of the actions within the plan need to happen sooner rather than later.

The FTA Ireland is calling on the Government to prioritise the following:

  • Trial Run- New systems have been developed by multi-agencies including Revenue, Department of Agriculture; Department of Transport and An Garda Siochana. Simulating potential scenarios in real time with willing subjects (shipping companies, freight forwarders, Ports and Hauliers) is very important at this time to assess the effectiveness of the new customs and SPS systems. Industry urgently needs these systems and traffic management plans at our key ports of Dublin and Rosslare to be trialled and tested and published. The sooner this happens the more learning can take place to help industry know what is expected of them in 6 months’ time and more importantly what needs tweaking with the State enforcement regime to facilitate free flowing trade activity.
  • Details of the traffic management plan around Dublin port and emergency parking facilities need to be published and provided to industry for consideration.
  • More support for the haulage sector to enable upskilling and planning to enable preparations for the new trading environment. COVID-19 has had implications on all business viability due to reduced activities.  If additional checks are added to transit routes the consequences on the delivery efficiencies will be impacted dramatically. Part of the contingency planning for operators is to consider all of the scenarios. Operators need state aid to upskill and review their contingency plans to ensure they are ready for the 1 January 2021.