Belfast Telegraph

Saturday 19 April 2014

Get the balance right

A geographic rebalancing of the local economy should be high on the agenda, says Sinead McLaughlin, chief executive of the Londonderry Chamber of Commerce

The need to ‘rebalance’ the Northern Ireland economy has become generally accepted. Yet there is a lack of clarity about what a balanced economy should look like. The concern regarding imbalance is commonly that our private sector is too small, while our public sector is unaffordable. It is also recognised that Northern Ireland must grow as a proportion of the UK and Irish economies.

Sadly, this discussion ignores an equally important imbalance. Frequently when the Northern Ireland economy is discussed, what is actually meant is the Belfast economy. Or, perhaps, the Greater Belfast, plus Antrim and Co Down, economy.

The economic realities in the North West are very different from those East of the Bann. True, we are all suffering. But Belfast will recover first and the situation is at its worst in the North West. All three district council areas with the highest claimant counts are in the North West — Londonderry, Strabane and Limavady. That is no coincidence.

For any region or city to succeed, it must have the right infrastructure and skills. The North West needs more of both. Road and rail links are inadequate; the airport needs more routes; visitors need more attractions; and the labour market needs more skills at the top end — to drive high value-added activities and inward investment.

None of this can be put right overnight and the award of City of Culture is a marvellous opportunity for Derry. But the recent Northern Ireland Budget decisions are likely to make things worse. The North West has been living in hope for years of fast road and rail links with Belfast and Dublin. These now seem even further away than ever — it could be many years before they are in place.

Even the City of Culture award received only luke-warm support from the Northern Ireland Executive. Amazingly, our Culture, Arts and Leisure Department is not providing any financial backing at all. True, most of the investment in City of Culture will come from the private sector — but a bit of pump-priming from the Culture Department would be well received.

Just as important is the need to invest in skills. While the first city has two fine universities, with large campuses, we have one fine — but far too small — campus. We also have an excessive number of people who are unemployable because they lack even basic skills.

The ambition of Derry is to be financially self-sufficient. We want to pay our own way; to be a viable and sustainable community; to retain, not export, our talent; to be a digital, creative, vibrant city.

This ambition should be shared by all. If our ambitions are fulfilled, we can contribute to the tax income of governments both in Belfast and London. We can cut the welfare benefits bill and the costs of the State. Yet sometimes this aspiration seems not to be recognised as in the interests of all of Northern Ireland and the UK.

The traditional view of cities is that they must compete — Manchester against Liverpool; Dublin versus Cork; Glasgow pitted against Edinburgh; and, of course, Belfast competing with Derry. That attitude is history. Cities that were rivals are now partners — they grow together. If they don’t, they both lose out.

It is in Belfast’s interest to have a successful Derry. A strong economy in the North West means lower tax bills for all. Tourists who visit City of Culture 2013 will probably also call into Belfast, the North Coast and the Fermanagh Lakes. Businesses that thrive in the Maiden City want to trade with those in the first city. Commerce and the population of Derry would welcome more investment from enterprises in Belfast.

We are not players in a zero-sum game. Everyone can benefit from a rebalanced economy in which the North West pays its way.