EU Trade Agreement Economic Impact 2025-07-02
2025-07-02
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Questions & Answers
Q1
Direct Answer
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Context
The UK and EU announced a new trade agreement on May 19, 2025. This agreement is expected to affect various sectors in the UK, including Northern Ireland's economy.
I am pleased that the agreement secured with our largest trading partner, the European Union, will make it easier for food and drink to be imported and exported. Will the Secretary of State assure me and my constituents that all future conversations with trading partners will continue to prioritise high welfare standards and food standards on both sides of the Irish sea?
I can happily give my hon. Friend that assurance. He will have noticed how in another context—the trade agreement reached with the United States of America—we said that we would uphold our food standards in that agreement, and that is exactly what we have done.
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Q2
Direct Answer
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Context
The new UK-EU trade agreement aims to smooth trade flows across the Irish Sea. The agreement includes provisions related to sanitary and phytosanitary measures.
Which of the sanitary and phytosanitary and agrifood requirements does the Secretary of State expect to be removed on goods moving from Great Britain to Northern Ireland as a result of the SPS agreement with the EU?
Once we have negotiated the legal text and put our rulebook in line with current European arrangements, there will be: no need for SPS paperwork; no mandatory identity checks or physical checks on goods moving; no need for Northern Ireland plant health labels; an end to the ban on chilled frozen meats moving; an end to the ban on movements of products of animal origin imported to GB and then moved to Northern Ireland; and no onward paperwork or checks on agrifood moved for onward processing.
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Q3
Direct Answer
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Context
The proposed SPS agreement has received positive feedback from various sectors, including farming communities in Wales and the Federation of Small Businesses.
I am pleased to say that the proposed SPS agreement has been welcomed by the Welsh farming community, including those in my constituency of Clwyd East. That is alongside the Ulster Farmers Union, the Federation of Small Businesses, the CBI, the Horticultural Trades Association, supermarkets including Asda, M&S and Iceland, and many others. Does the Secretary of State agree with me and with them that an SPS agreement would bring huge benefits for Wales, Northern Ireland and the rest of the UK?
It certainly would. It is a rare agreement that invites so much praise, certainly across the range of opinion in Northern Ireland. We all want to see it progress as quickly as possible, so we have got to turn it into a legal text and sort out our own legal rulebook. The benefits will then flow for businesses right across the United Kingdom.
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Q4
Direct Answer
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Context
The Windsor framework has introduced significant barriers for businesses, particularly small ones, with high costs and bureaucratic hurdles.
The Windsor framework is causing untold damage to businesses in Northern Ireland. It cost one of my local businesses £86 to bring a box of simple ties from GB to Northern Ireland because of the parcels border, and used farm machinery is now subject to EU import procedures, with some having been turned back from the ports to Scotland in recent days. The latest FSB report confirms that small businesses are being hardest hit with red tape costs and uncertainty. Will the Secretary of State accept that the reset is not helping the here and now? Will he commit to meeting these industries and helping to sort out practical solutions?
On the agricultural machinery point that the hon. Member raises, if the machinery is coming into and staying in Northern Ireland, it can be brought in, subject to cleaning, with a plant health label that is relatively straightforward. Only if it might move into Ireland would it need to go through the red lane. I will make this general point: in 2023 Northern Ireland purchases of goods from the rest of the United Kingdom rose by 16.2%, and Northern Ireland is the fastest growing region in the UK.
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Q5
Partial Answer
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Context
The Federation of Small Businesses in Northern Ireland published a report indicating that one-third of small businesses moving goods between Great Britain and Northern Ireland have ceased trading with customers or partners either in Great Britain or in Northern Ireland due to trade difficulties.
Two weeks ago, the Federation of Small Businesses in Northern Ireland released a report stating that one-third of small businesses moving goods between Great Britain and Northern Ireland have stopped supplying their customers or partners. Under the Northern Ireland protocol, if there is a diversion of trade caused by UK measures, we are entitled to take unilateral action to safeguard our internal market. Does the Secretary of State believe that one-third of businesses ceasing trading amounts to a diversion of trade? If not, could he clarify what would constitute such a scenario?
While some small businesses are experiencing difficulties in moving goods from GB to Northern Ireland, others continue to operate successfully. The current situation is governed by the Windsor framework rather than the Northern Ireland protocol, and it represents an improvement over previous arrangements. However, the Secretary of State did not explicitly address whether one-third of businesses ceasing trade qualifies as a diversion of trade under the protocol.
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Assessment & feedback
The Secretary of State avoided specifying whether cessation by one-third of small businesses constitutes a diversion of trade under the protocol.
Changing Subject
Providing General Statement
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Q6
Partial Answer
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Context
The Federation of Small Businesses has warned that Northern Ireland businesses face ongoing disruption under the Windsor framework, with inadequate communication from the Government on its supposed advantages. There is growing criticism from firms across the UK due to red tape and uncertainty.
The FSB report highlights continuing disruption for small and medium-sized enterprises in Northern Ireland despite dual market access through the Windsor framework. The Government's failure to effectively communicate these benefits has led to increased scepticism among businesses. Can the Secretary of State identify concrete benefits that this dual market access is currently providing to Northern Ireland firms? How does he respond to growing criticism from UK companies burdened by bureaucratic red tape and uncertainty?
The Secretary of State acknowledges the FSB report and notes that he regularly speaks with companies in Northern Ireland who report experiencing benefits from dual market access. He emphasises the responsibility to highlight these opportunities, as businesses tend to seize such advantages when they see them. However, he did not provide specific examples or evidence of concrete benefits.
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Assessment & feedback
The Secretary of State failed to offer concrete evidence or specific examples of dual market access benefits for Northern Ireland firms.
Providing General Statement
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