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Crucial manufacturing investments in Northern Ireland 'on hold' amid uncertainty around Brexit

By John Mulgrew

Published 20/09/2016

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Crucial investments remain on hold within Northern Ireland's manufacturing sector due to the lack of a clear post-Brexit plan, it has been warned.

And Stephen Kelly, chief executive of Manufacturing NI, said that three months on since the EU vote, the "future remains as yet unclear" for firms here.

"Government needs to inject confidence. For many, investments are on hold until there is clarity on future trading relationships and wider economic conditions will be," he said.

"This impacts on GDP, but more critically every day a manufacturer holds off investing in plant and machinery is a day closer to being uncompetitive or indeed to closure.

"A stimulus is required - some tools to provide confidence and begin spending."

But he said, what was emerging was an "understanding of the huge complexity and dangers of taking Northern Ireland out of the EU, and less quickly, a list of solutions and indeed opportunities which may exist post-EU exit".

Northern Ireland's manufacturing sector has suffered several major hits in the last year.

Earlier this month, Caterpillar revealed it was closing its Monkstown site and letting 250 staff go.

Meanwhile, 1,080 jobs are going at Canadian-owned aerospace giant Bombardier, around 860 posts are set to go at Ballymena's Michelin, and a similar number have been lost at cigarette-maker JTI Gallaher.

"We can begin taking steps now by ensuring there's more Northern Ireland content in public procurement at home and across the UK," Mr Kelly said.

"We need to maximise our take from EU funds, before Brexit particularly, for important infrastructural projects, but that must come with quicker decisions, planning and delivery."

He said, by the end of the autumn, the UK, including Northern Ireland, must have a "refreshed economic strategy, but this must account for a post-Brexit environment".

"It should focus on making Northern Ireland a competitive, export focused and innovative economy," Mr Kelly said.

"Brexit is bigger than politics and the business community has offered use of its networks and to play an active part in supporting the Executive and others achieve a sensible outcome which will allow business to grow and get more people into work.

"Whilst there is frustration at the pace of arriving at a Northern Ireland position, there is a degree of understanding given the nature of how the referendum was fought, what a heavy load exiting the EU will bring, and indeed a lack of clarity on what the UK government's preferred position will be once Article 50 is triggered.

"For manufacturing, concerns remain on getting access to the single market and skilled, semi-skilled and flexible labour."

A report commissioned earlier this year pointed the finger at huge energy costs as a major problem facing the manufacturing industry here.

And following the latest Caterpillar job cuts, there were fresh calls for a dedicated manufacturing strategy.

However, Economy Minister Simon Hamilton said that those who have used the latest job losses to "attack the Northern Ireland Executive do a disservice" to workers losing their jobs.

He has ruled out a dedicated scheme to tackle issues facing the sector here.

Stephen Kelly said any post-Brexit landscape must be "tariff free" and include the "unhindered movement of goods across the border and into the rest of the EU is a must".

"Reports of a Downing Street desire to leave the customs union are alarming as is the suggestion the Secretary of State for Exiting the European Union is looking at the Norwegian/Swedish Border being a potential model for any UK border in Ireland," he said.

"Reassurance from the Secretary of State and other UK ministers on the Common Travel Area and 'no hard border' are irrelevant in this context."

Recently published HMRC export statistics show a rise in the value of sales, but a 5% drop in the number of exporters.

Mr Kelly said that few businesses here "believe suggestions that a post-Brexit trading environment would improve the Northern Ireland economy".

He added: "Business is asking for honesty and a collective and creative approach to getting the best deal for Northern Ireland.

"A special status is likely to be required as is a sharp focus on improving competitiveness by reducing the costs of doing business."

Belfast Telegraph

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