According to Joe Kennedy, the White House special envoy for Northern Ireland, an influx of US investment in Northern Ireland is indeed possible, with several investors preparing to make deals. Kennedy has revealed that senior executives he has spoken to now view Northern Ireland as a “unique investment opportunity.” The post-Brexit trading arrangements offer Northern Ireland the ability to sell freely into both the UK internal market and the European single market, making it an attractive prospect for investors.
Kennedy stated that several companies are ready to make investments right now, while others are in the final stages of their planning. However, there are some key factors that investors are considering before committing to these deals.
Political Situation and Investment Opportunities
One of the key factors is the dual market access provided by the Northern Ireland Protocol, which was created to ensure a free-flowing Irish land border post-Brexit. While this provision allows Northern Ireland to sell freely into both markets, it has also created new regulatory and customs checks on goods moving from Great Britain into Northern Ireland, which has upset unionists and caused the Democratic Unionist Party (DUP) to collapse power-sharing at Stormont in protest.
The recent Windsor Framework aims to reduce red tape on goods entering Northern Ireland from the UK while still maintaining dual market access for Northern Ireland-based companies to sell freely into Britain and the EU. However, the DUP believes that the new accord does not go far enough to address its sovereignty and EU law application concerns in Northern Ireland, and the party is keeping its blockade of Stormont until it receives further legal assurances from the UK government.
Kennedy emphasized that the lack of a devolved administration was also a factor in US companies’ considerations of making investments. The return of power-sharing, according to him, would help to remove the question mark around the political structure, regulatory framework, and process by which rules are set, altered, or moved.
Kennedy also noted that over 200 US companies already have footprints in Northern Ireland.
Investment Scale and Political Questions
Kennedy revealed that some US companies were preparing to make significant investments in Northern Ireland, ranging from millions to tens of millions or even higher. However, Kennedy warned that executives would require real confidence in the framework upon which they had made that investment thesis before making that decision. He also noted that some companies were waiting to see how the Windsor Framework operated in practice, particularly the Stormont Brake mechanism that allowed a minority of MLAs to formally request the UK government to veto the application of specific new EU laws in Northern Ireland.
According to Kennedy, some of the larger companies would likely wait and observe the Windsor Framework in action to answer some questions that he thinks will be helpful. However, he detected an “excitement” among the executives he had spoken to about the potential benefits of investment in Northern Ireland.
Importance of Devolved Administration
Kennedy highlighted the significance of a devolved administration in Northern Ireland for investment opportunities, stating that businesses needed clarity around the regulatory framework and the process by which rules are set, altered, or moved. Having a devolved administration would help investors understand Northern Ireland’s political structure and the regulatory framework, and provide clarity around the process by which rules are set, altered, or moved.
Kennedy mentioned that the lack of a ministerial executive at Stormont was not a “binary” factor and would not necessarily put off all investors. However, the return of a devolved administration would make Northern Ireland a more attractive option.
Conclusion
In conclusion, Joe Kennedy believes that the prospect of US investment in Northern Ireland is indeed real, and several investors are preparing to make deals. The unique investment opportunity presented by Northern Ireland’s dual market access and post-Brexit trading arrangements is a significant factor in this. However, political uncertainty and the lack of a devolved administration are also key considerations for investors.
Kennedy emphasized that the return of power-sharing and the clarification of larger-scale political uncertainty has created a unique opportunity for investment in Northern Ireland. As a result, several US companies are ready to make investments now, and others are finalizing their plans. With a clear regulatory framework and a functioning administration, Northern Ireland could become an even more attractive investment option in the future.
