Posted on Friday 2 November 2018 by Ulster Business
John Mulgrew speaks to Foyle Port chief executive Brian McGrath about sharing UK and Irish waters, the burden of increased bureaucracy but looking at a potential Brexit silver-lining coming down the line
There’s a surprising air of optimism surrounding Brian McGrath when it comes to the UK’s exit from the EU.
While the Foyle Port chief believes the £9m business – which handles around £1.5bn in commodities each year – could feel the bureaucratic hand of a post-Brexit environment, such as delays, paperwork and a potential “logjam”, that it’s in a unique position, sharing both UK and Irish waters.
But he believes the Irish border was a mere “second thought” when Brexit campaigning was at its height – instead, focused around an emotional argument around immigration. A national debate which “we have been swept up in”, he says.
While he says there remain serious issues which leave his business, and the rest of Northern Ireland, in the dark, far from seeing the port’s proximity with the border – in fact much of the mass of water is in the Republic – as a negative, Brian believes it could positively position it following Brexit.
“We are unique as we are both a UK and European port, which is a fantastic opportunity with Brexit coming up.
“We are talking to the City Deal people, the UK and Irish governments along with Donegal.
“I think we, along with others, particularly, have an opportunity… there are difficulties we could face, especially with a no deal. We are pleased we can articulate our concerns and still hopefully have practical solutions.
“Even in a ‘no deal’ scenario, where we are located, there will need to be good relations. Around 30% (of workers) commute from Donegal. They will still need to do that.
“In a paradox, it does bring some benefits. We have benefits with this Atlantic gateway – it is under-used, and can be utilised in a way to straddle the border. We are speaking about how we can join the dots.”
Brian says the port has been working with Donegal County Council, over plans for its new cruise ship terminal at Greencastle.
“We have the ability to import materials into the Irish side in the case of a hard Brexit. It wouldn’t take a huge amount of investment to make that happen.
“There’s another dimension (with our) infrastructure capacity. We have a lot of things in place which is strong.
“We have deep water available, and have access to probably the biggest land bank in the British Isles.
“Project Kelvin – the high-speed trans-Atlantic fibre-optic cable connection – runs right past our offices. We have over 400MW of power right beside us. In terms of the building blocks for basic industrial development, they are all in place.
“In effect, a ‘no deal’ hard Brexit would be the ultimate impact… it means additional bureaucracy, would cost our port customers time and money, and might make them look at alternative ports to bring material in.
“We are not insulated form the operational side of things. Materials coming in from the rest of the world. What could be an extreme in this, ultimately, it might mean, bringing in two million tonnes a year, 40% from Europe – that 40% could be subject to tariffs, or a lot of bureaucracy.”
Laying it all out, the key concern is if huge bulk cargo – such as grain or animal feed – has to be ‘unitised’ into separate lorry loads, which require single certification each time.
“It could create a fairly substantial bureaucracy around the logistics. That’s the very worst situation.”
But business is good. Brian says the port employs 100 staff directly, but around 1,000 indirectly.
“The numbers we put out in turnover are really strong, but they are modest in a sense that they don’t reflect the impact of what we do,” he says.
“Percentage-wise, it’s mostly about the job creation that comes into the regional economy.
“We have reinvested £30m in the last few years, have a £40m asset base and handle about £1.5bn in commodities a year.”
In the other corner, Brian’s closely involved in Derry’s bid for a City Deal, similar to that submitted by six councils, including Belfast, last month.
“We are working really closely with the infrastructure around the City Deal. There are two strands – there is the innovation, which is being led by Ulster University, and there is the infrastructure, which we will be playing a fairly central role in.”
So, back to Brexit. What will Brian and his team be doing on the morning of March 29? “As much as you can do, we will continue as normal,” he said.
“We have a number of preparedness scenarios. We are as prepared as I think we can be.
“We could be prepared, but log jams (outside of the business) are beyond our control.
“I don’t hear anyone talking up, or looking for a no deal outcome. I think Northern Ireland businesses have articulated it (concerns) very well, and we are punching above our weight.”
The biggest issue is whereby a customer could look to moving elsewhere, thus moving trade away from the north west, Brian says.
Looking back almost two and half years ago, and examining the current landscape today – whereby the UK is set to leave both the customs union and single market – Brian says: “I would have stayed in the customs union and single market. Our strategy has been to defend and grow – why would anyone want to turn away from the biggest customer base?
“I am not critical of people who wanted to leave the EU – but the way it has been done has not exactly been helpful.
“What we see, in my own personal interpretation, when we talk to politicians, particularly from the UK, that the decision to leave the EU was made on (the basis) of immigration.
“That is what took us on the path. There’s then the second thought of the Irish question. If you can solve the issue for Derry, you can solve it for Dover. I don’t think that was considered when the case for leaving on immigration.
“We have been swept up in an alternative, national debate – not something relevant for us.”
And what’s next for the port? Brian says it’s been through three successful strategies, so far, in terms of expanding the growth.
“It’s about leveraging in the core (business) and selling out the additional capacity to other capacities.
“For example, in our marine, we invested in vessels – dredgers. When not used for our work, we go around the UK and Ireland, and offering expertise to other ports.
“The key things we are doing is the strategic aims, to defend and grow – maintaining our core business, with core customers, and then looking to developing the industrial land bank and tourist product.”