The Northern Ireland protocol is "unworkable" but it won't be scrapped and will remain a "permanent sore" in the Brexit process, Martin Wolf, chief economics correspondent with the Financial Times, has claimed.
Addressing an event in Dublin hosted by the Institute of International and European Affairs (IIEA), Mr Wolf said the UK government had no clear Brexit endgame, and no idea how to resolve the problems with the protocol.
He described the rules governing the North's post-Brexit trading relations as "unacceptable and unworkable", and most likely not fully understood by UK prime minister Boris Johnson when he agreed them.
Under the protocol trade between Northern Ireland and Britain is subject to customs checks. The additional red tape has significantly damaged trade between the two locations, particularly the flow of goods from Britain to the North.
“My guess is it will be a permanent sore without actually blowing up,” he said, noting neither side, the EU nor the UK, wanted relations to break down entirely.
On the wider issue of the UK’s post-Brexit position in the world, Mr Wolf said: “What’s the endgame? I think this government doesn’t know. It’s basically playing two games, both of which are attractive.
“One game is, Brexit is behind us, we want to form mature relations with everybody else and move on to our new bright future ... levelling up, global Britain, all these things,” he said.
The other game, he said, involved ratcheting up national tensions or anti-European sentiment by deliberating manufacturing diplomatic spats.
“The Northern Ireland protocol is the great mess in the middle of this,” he said.
Mr Wolf is a world-renowned journalist and the author of a number of influential books including most recently The Shifts and the Shocks.
In a wide-ranging address to the institute, he spoke about what he described as the breakdown of the relationship between market capitalism and liberal democracy, as well as soaring inequality, which he said, was undermining western democratic states.
Populist elements in the UK had used opposition to the EU as a way of uniting people when the real failures – economic, political or otherwise – had all been domestic, he said.
Mr Wolf said a pre-existing trend towards inequality had been accelerated by the 2008 financial crisis.
And big financial crises had a corrosive effect on politics because “it’s so obvious the people in charge – particularly some of the wealthiest and most powerful people – didn’t know what they were doing, and they were rescued”.
"This is immensely embittering for the population," Mr Wolf said, noting this had led to populist, demagogic figures such as Donald Trump in the US, who played on the public fears and sensibilities while threatening the norms and laws upon which liberal democracies resided.
"The danger, of course, is that we get trapped in a Latin American cycle of instability, with autocratic demagogues emerging and destabilising our political systems."