The UK says it will leave customs union on in a year’s time. However, it also says it accepts that there cannot be a hard border between Northern Ireland (part of the UK) and the Republic of Ireland. Nor can the hard border be placed between Northern Ireland and the UK. The Democratic Unionists of Northern Ireland have given Tory Prime Minister critical support in Parliament.  

Although many see EU negotiators playing hardball with the UK, they have allowed negotiations to proceed even though the Irish border issue remains unresolved everywhere but in theory. The UK is pinning its hopes on a technological solution, that when first suggested was dismissed by EU negotiators as “magical thinking.” 

The UK proposed two solutions. The first is a “streamlined customs union” which would still require border checks but softer in nature. The second, and that is what is drawing attention, is for a customs partnership. The UK would 1) be able to track the destination of all goods that enter the countries, 2) it would collect duties on goods that are headed to the EU and send the funds to the EU, and 3) would collect other duties for goods that stay in the UK.  

The key is a tracking technology that can accurately identify the final destination of all goods.  Although not familiar with all the technology available, part of the logistical challenge is that trade in semi-finished goods or components by cross national frontiers more than once. It would be much easier if the UK simply stayed in the customs union or committed to retaining the EU’s regulatory standard. Yet both sit ill with the Brexit camp.  

Singapore is regarding as the best in the class in deploying technological solutions for customs. Estimates suggest that it could take the UK five to seven years to adopt and implement a similar program. The UK seems to lack a sense of urgency. In contrast, for example, the Dutch have reportedly hired 750 new officials in anticipation increased activity.