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Northern Ireland may bolster case for own spinoff
March 2, 2017 / 9:42 AM / in 9 months

Northern Ireland may bolster case for own spinoff

LONDON (Reuters Breakingviews) - Northern Ireland may be about to vote for its own eventual spinoff. The outcome of upcoming elections in the UK member state may see London again having to rule the thorny region directly. Given the high cost of propping up the region, and the problems with potentially reunifying it with Ireland to the south, the north is becoming a problem that no one wants.

An election campaign poster is seen in the Falls Road area of west Belfast, Northern Ireland, February 28, 2017. REUTERS/Toby Melville - RTS10R57

Under the terms of a 1998 peace agreement, the region is jointly governed by the largest parties on either side of the nationalist-unionist divide. Right now, those parties are the Democratic Unionist Party and Sinn Fein. Rancor between the two collapsed their power-sharing arrangement in January, triggering Thursday’s election. If the DUP’s Arlene Foster and Sinn Fein’s Michelle O’Neill cannot agree to form a new government, there is a real prospect of a return to direct rule from London.

To say Britain’s Prime Minister Theresa May doesn’t need the hassle is an understatement. Northern Ireland’s weak economy, subsidised to the tune of approximately 9 billion pounds annually, is already a drain. And it could get worse once Britain leaves the European Union. Agricultural subsidies from Brussels account for 103 percent of farm incomes, according to the Northern Ireland Assembly.

Nor can Britain simply call the union a day. Reuniting the north and south of Ireland would be politically toxic to the North’s loyalist population. And it would be poison too to Ireland’s economy, with the extra costs reducing household income in the south by 15 percent according to economist John FitzGerald.

The prospect of the north standing on its own two feet economically looks equally remote. It’s the least innovative region of the UK, with 27 percent of all employment in the public sector, compared with 17 percent in Britain. Plans for export-led growth are challenged by the possible re-establishment of a border with the south once Brexit happens.

Since factions in Scotland are pushing for independence, the British government has powerful motivations to keep the respective bits of the United Kingdom together. But that is a fragile situation. Add political dysfunction to a dismal economic track record, and Westminster may decide it’s no longer worth staying invested.

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