The Dividends of Cross-border Co-operation

It has been 20 years since the signing of the Good Friday (Belfast) Agreement and the establishment of InterTradeIreland as a North/South Implementation Body with a legislative mandate ‘to exchange information and co-ordinate work on trade, business development and related matters’.  Aidan Gough, Designated Officer and Director of Strategy and Policy at InterTradeIreland reflects on the progress made over the past 20 years, a period over which InterTradeIreland engaged with nearly 40,000 businesses, directly supporting 9,000 to create added business development value of £1bn and 14,800 jobs.

InterTradeIreland helps small businesses in Ireland and Northern Ireland explore new cross-border markets, develop new products, processes and services and become investor ready and has a remit to support increased co-operation in trade and competitiveness.

Cross-border trade has grown steadily and significantly…

Total cross-border trade has been growing at an average rate of 4% per annum over the past 20 years and currently stands at €6.98/£6.11bn for 2017 more than doubling in the past 20 years.

Northern Irish exports to Ireland were worth some £3.9/€4.4bn to the local economy in 2017. For 80% of Northern Ireland micro firms and for 70% of small firms, Ireland is the only export market. Small businesses (0-49) account for 93% of exporters and 46% of value of exports to Ireland (2016).

Increased co-operation in trade has been replicated in innovation and research partnerships, driving further value

Small busineses have benefitted from participation in InterTradeIreland’s suite of trade supports particularly our sales and marketing programme, Acumen, with the average benefit for participants being £250,000.

There is a considerable level of interconnectedness of trade and cross-border supply chain integration on the island, with almost 80% of cross-border trade taking place in intermediate products. Businesses operating within their supply chains back and forth across the border make up the majority of cross-border trade.

In fact, recent research by the Department for the Economy and the Northern Ireland Statistics Research Agency3 (NISRA) concludes that two-thirds of Northern Ireland goods trade with Ireland can be considered to be part of supply chain activity when meat and dairy products (known to be predominantly intermediate in nature) are considered

A significant development has been the evolution of highly integrated cross-border supply chains

InterTradeIeland’s own research has shown that exporting and innovation are two pillars of successful businesses and our cross-border supports reflect this fact. Since 2001 our FUSION initiative has assisted over 600 industry-academia collaboration projects generating an average return of £850,000 per company.

Our all-island Challenge Programme speeds up the time it takes businesses to bring products to the market by 2-3 times.  The benefits and value of collaborative partnerships and networks have also been apparent in the success of the US-Ireland R&D Partnership in which 49 projects to a value of £60m have been approved in areas such as health, science and engineering, telecommunication energy and sustainability.

The value of collaborative working has also been shown in North/South partnership involvement in EU Research frameworks. Within the first two years (2014-2016) of the Horizon 2020 programme, North South applications and drawdown was almost double that of the previous programme, FP7.

Further opportunities to be explored

Clearly cross-border cooperation has delivered tangible benefits particularly but not exclusively to smaller businesses across the island.  With only 15% of goods produced in Northern Ireland being exported beyond its border, and only 1.6 % of Irish goods exports going north, there are still plenty of opportunities for the further growth that cross-border trading delivers while the development of cross-border research, development and innovation partnerships is building an all-island community that will create further synergies.

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