Building a new architecture for the all-Ireland economy

Apart from ensuring the smooth operation of the new' cross border inward investment zone, strong interconnections between internal and all-island policy-making will be required to make meaningful progress in other dimensions of the all-Ireland economy. As highlighted in Chapter 5, if the Northern Ireland Protocol to the EL) Withdrawal Agreement results in trade and other administrative barriers between the region and the rest of the UK, then strong incentives will exist for greater regulatory and policy cooperation between the two parts of Ireland, particularly in the agricultural and agrifood sectors. With Northern Ireland’s permanent membership of the EU’s customs union and internal market more or less assured, the power sharing government may find it more efficient to adopt a common all-Ireland regulatory approach to EU legislation so as to build a common all-Ireland platform for trade with the rest of the EU. In addition to the influences released by Northern Ireland’s new' special status within the EU in favour of a stronger all-Ireland economy, other aspects of private and public sector activity are ripe for greater cross border policy coordination and joint initiatives. Huge scope exists for greater cooperation between the universities in Ireland. Joint all-Ireland initiatives w'ould not only be possible, but also preferable on different aspects of labour market governance, ranging from employment regulation on gig w'orkers, health and safety, equality, and so on, to the development of socially responsible models of w'ork of the future. On both sides of the border, the full potential of creative industries has yet to be realized and it w'ould make eminent sense to adopt an all-Ireland approach to this problem. Areas such as transport, climate change, and energy are also ripe for greater all-Ireland cooperation.

The existing institutional architecture to promote north-south cooperation is not robust enough to house the scale of interactions required to advance the all-island economy - as the assessment in Chapter 3 highlights. A range of institutional innovations are needed for the task. The preferable method of introducing the desired changes would be through the broad political framework set out in the Belfast Agreement. Clearly, the current institutional procedures set out for Strands 2 and 3 of the Agreement would have to be heavily revised so that more appropriate institutional mechanisms are created

Figure 7.1 New institutional architecture for all-Ireland economic integration to enable deeper forms all-island economic activity. Amending the original Treaty in such a manner would be a big step, but it would not be an unprecedented one. After all, important changes w'ere made to the Belfast Agreement in 2006 to restore the local power-sharing institutions, which became embodied in the so-called St Andrews Agreement. If it is not possible to introduce the necessary institutional changes through the Belfast Agreement then the British and Irish Government should take the lead and conclude bilateral agreements that would pave the way for institutional foundations being established for the all-Ireland economy.

Figure 7.1 sets out the broad character of the institutional changes that are likely to be needed to make meaningful sustained progress towards an all- Ireland economy. Probably the single most important change required is the creation of something akin to an all-Ireland Economic Commission or Council that is properly staffed with wide ranging responsibilities. Making the Commission report to the NSMC would be a neat way of ensuring its democratic accountability. No such body currently exists - at the moment a small secretariat services the NSMC, but it barely has the capacity to conduct the administrative tasks necessary to keep the Council functioning. An all-Ireland Economic Commission would have multiple overlapping roles. One would be to foster a new' cognitive structure - a new mind set - for north-south economic integration. Currently, the prevailing economic policy agendas in both parts of the island are like ships that pass in the night - developed in isolation from each other, these agendas, as highlighted in Table 7.1, emphasize sharply contrasting priorities that do not anticipate, let alone encourage, all-island cooperative action on the economy. It is a vivid testimony to just how separate the two economies remain after more than 20 years of the Belfast Agreement and of the near absence of any strategic thinking on how' best to ‘mesh" together the tw'o economies - a process that the French call engrenage. An all-Ireland Economic Commission w'ould set about reversing this situation by putting north-south economic interactions front and centre of economic policy discussions in both parts of the island. It would seek to generate a cognitive framework that creates a new understanding about how each economy on the island can only advance by deepening the linkages and relationships with the other.

Generating this new cognitive framework will require the all-Ireland Economic Commission to launch a w'ide ranging strategy of what might be called ‘integration-by-doing’. Such a strategy would eschew the standard economic development policy model that envisions centralized decision-making.

In this top-down model, a select group of elite policy-makers and administrators drawn-up a definitive plan that sets out fully specified north-south cooperation initiatives to be implemented in a regimented form by low'er tiers of bureaucracy. An ‘integration-by-doing’ strategy seeks to make progress towards an all-Ireland economy in a different manner. To begin with, a conscious effort is made not to embark on overly-ambitious big projects that seek to realize too much integration too soon. Moreover, issues with the

The imperative of an all-Ireland economy 131 Table 7.1 The divergent economic policy agendas, north and south

Source: Adopted from Bradley 2018.

potential to be highly contentious would also be avoided in the first instance. There is little to be gained by launching north-south collaborative programmes that create institutional disruption and little else. The litmus test for any ‘integration-by-doing’ all-Ireland initiative is that it realizes some type of performance-enhancing outcomes - it brings improvements of some form. Thus an ‘integration-by-doing’ strategy focuses on launching all-Ireland economic projects that are discrete yet challenging and achieving in the sense they are able to show tangible progress in a few' years. The thrust of the strategy is to advance all-Ireland economic integration by deconstructing problems, identify the root causes that need addressing, and assist the development of contextualized solutions.

The purpose of ‘integration-by-doing’ is to build all-Ireland economic capabilities by identifying weaknesses in the incumbent structures of the two economies on the island and showing how these can be remedied through decisive cross-jurisdictional action. The approach is premised on the notion that all-island economic cooperation will only emerge through continuously launching concrete programmes to remove blockages to greater cross border economic linkages and to capture unexploited opportunities for performance-enhancing joint action. As a strategy, ‘integration-by-doing’ is assumed to be strongly recursive in character: output from particular north- south projects or programmes is used as the platform for a further round of all-island collaboration. To this end, the role of the all-Ireland Economic Commission is to cultivate a permissive or authorizing environment that promotes on-going experiments on all-island economic cooperation. It is evident that the "integration-by doing’ approach is inimical to the idea of an all-Ireland economy being forged by constitutional fiat. Instead, it envisages the two economies on the island being brought together through the cumulative effect of discrete yet significant programmes and projects: incremental action that is both continuous and coherent is seen as transforming the relationship between the two economies by stealth.

Securing root and branch change through incremental action will require the all-Ireland Economic Commission continuously to monitor progress towards an all-Ireland economy by holding a regular cycle of meetings with different programmes and initiatives. The purpose of these meetings is not only to reveal the progress that has been made, but also to seek explanations for this progress. Conversely, it is also to identify programmes that have stalled, diagnose the causes of the lack of progress, and seek solutions. In other words, the Economic Commission has to be the guardian of the all- Ireland economy project, and to this end needs to ensure progress towards new all-island economic relationships is both on-going and meaningful. Through this activity, the Commission must be able continuously to update and revise established thinking about how and under what conditions effective synergies can be built between the two economies. It must have the internal capacity to address obstacles to greater north-south economic integration that are proving to be intractable. One way this could be done is for the Council to have a ‘bumping-up’ authority that would allow it to bring difficult problems to the highest level of government so that focused concerted action can be devised to address the situation.

Overall, the ‘integration-by-doing’ model rests strongly on the core properties of deliberative governance. Thus, the policy orientation is very much on problem solving. The emphasis is on the fast and effective resolution of problems standing in the way of greater north-south economic cooperation through the use of procedures that enjoy the confidence of all relevant stakeholders. To this end, all-Ireland economic projects need to put a premium on the widest possible sharing of information and for decisions to be reached through reasoned, preference-changing dialogue. Each project encourages broad participation by interested and affected parties in the design and implementation of policy. Such an approach has not only inherent democratic appeal, it also encourages those involved in a particular policy initiative to develop a sense of ownership and commitment to the solution that is devised for a particular problem. A third attribute of deliberative governance is that it eschews a prescriptive approach to policy making which normally involves establishing a checklist of activities, assigning responsibilities to particular agencies and individuals and then executing the identified task. Under deliberative governance, policy-making is more open: there is a willingness to experiment with new ideas and new ways of working. There is also a willingness to devise solutions to problems without foreclosing the possibility of rethinking both solutions and goals. Thus policy initiatives to gain closer economic integration on the island are not considered immutable or fixed, but instead provisional and open to revision.

Institutionally revamping Strand 2 of the Belfast Agreement so that it is embedded in the logic of "integration-by-doing’ will lead to all-Ireland cooperation initiatives being launched that will have a far reaching cumulative impact over a period of years. These initiatives are more likely to embody features of the three critical policy categories conducive to building strong cross border economic linkages that are highlighted in Chapter 3 - policy entrepreneurship, policy recombination, and policy complementarities. If it operates properly, the "integration-by-doing’ approach is likely to trigger amongst the participants in all-island cooperation projects a process of interaction, interpretation, and internalization. As a result, a new set of expectations and preferences is promoted amongst the policy and business communities about the possibilities of all-island economic and business activity: a series of customized iterative processes of strategic action between public agencies and private sector bodies and organizations would be established not only to deal with the challenges thrown up by Brexit, but also to make Northern Ireland more economically and socially dynamic. In relation to the Northern Ireland economy specifically, meaningful and purposeful cross border economic and business activity might come to be seen as an important pathway out of decades of mediocre business performance.

An attractive feature of this problem-solving approach is that trust and cooperation are not the preconditions for cross-national collaborative policy action, but actually the outcome. Through the process of developing agreed solutions to jointly identified problems, norms of reciprocity and mutual reliance are likely to be forged in which Ireland and Northern Ireland become increasingly dependent on each other economically. A key part of this process will be the creation of credible commitments. Credible commitments are important because participants gain an assurance about the behaviour of others but at the same time must provide an assurance about their own behaviour. In this situation, opportunistic behaviour is less likely and trust relations come to the fore. The problem solving approach to cross border cooperation envisions a process in which the various participants seek to advance their own interests by promoting a common agenda that incorporates the interests and views of others. This is an important dynamic particularly in a context where trust and understanding on cross border matters have been low and strategic engagement has been underdeveloped.

The outcome from this more policy or institutionally-driven form of north-south cooperation is likely to be greater alignment between business rules and regulation in both parts of the island. A dramatic increase in the level of interaction between the public administrations in Dublin and Belfast would occur and the longstanding coordination deficit between the two parts of the island would give way to concerted, on-going institutional interventions to secure meaningful forms of cross border cooperation. As already pointed out in Chapter 5, Strand 3 of the Belfast Agreement would also be affected by the adoption of an ‘integration-by-doing’ approach to developing the all-Ireland economy. Its existing processes for bilateral monitoring. discussions and even negotiations will probably need strengthening to ensure that orderly and stable relationships are maintained between the two countries after Brexit. These strengthened processes may be required not only to manage the new context for East-West cooperation, but also to make an input into the new dynamics of north-south relations within Ireland. Formally, the character and pace of north-south cooperation should be mostly determined by the Northern Ireland Executive and the Irish Government. But because the power sharing institutions in Northern Ireland are prone to ineffectual decision-making, the Irish and UK Governments through the aegis of Strand 3 of Agreement may be required to work with the Northern Ireland Executive and Assembly to define their goals in relation to cross border cooperation projects and help to coordinate activities necessary to achieve these designated goals. Thus, Strand 3 of the Agreement may need to take on the role of a ‘framing centre’ to guide the activities of the institutional bodies and procedures created by Strand 2 of the Agreement; promote new forms of cooperation between the two parts of the island; and develop predictable patterns of behaviour amongst those involved in allisland collaborations. Taking on responsibility for cross border responsibility would require an increase in the administrative capacity of Strand 3 institutions.