Belfast Telegraph

Wednesday 17 September 2014

Jobs warning over Northern Ireland flights

Northern Ireland is in danger of being cut off from future trade and job opportunities if flight connections are not improved, business leaders said.

Regular services to Heathrow are vital if the region is to avoid missing out on investment and exports, Chamber of Commerce chief executive Ann McGregor added. The London hub supports 1,000 tourism and 900 airport jobs in Northern Ireland.

A report was released today by analysts Oxford Economics to around 50 leading local businesses.

Ms McGregor said: "Encouraging increased trade between UK firms and overseas markets is vital to the rebalancing of the UK economy. While firms are being urged to trade with new partners in emerging markets, they are hindered by the lack of connections to these countries, in turn hurting both inward investment and Britain's export potential."

Dozens of businesses in Northern Ireland trade with or aspire to do business with Brazil, India and China.

Ms McGregor added: "While there are more ambitious long-term projects for aviation that can be examined, in the near-term Heathrow must continue to be part of the solution if Northern Ireland is not to miss out on trading opportunities."

There had been speculation that some flights between Belfast and Heathrow were under threat following the sale of BMI to the International Airlines Group (IAG). IAG agreed to buy BMI from Lufthansa for £172 million last December.

IAG chief executive Willie Walsh has confirmed that Belfast to Heathrow flights would continue despite the sale.

Ross Baker, Heathrow operator BAA's strategy director, said: "The centre of gravity in the world economy is shifting and Northern Ireland and the UK as a whole should be forging new links with emerging markets.

"Instead, we are edging towards a future cut off from some of the world's most important markets, with Paris and Frankfurt already boasting more flights to the three largest cities in China than Heathrow, our only hub airport."

Mark Nodder, managing director of Wright Group bus builders in Ballymena, said lack of routes to emerging markets from Heathrow was an issue for many Belfast businesses.

"The reality of the situation is that in many cases potential trading partners would rather do business with a country to which they have frequent direct air links," he added.

Meanwhile, almost a third of companies in Northern Ireland reported a slippage in exports in the final three months of last year.

A survey of 600 companies commissioned by the Chamber of Commerce found 30% experienced a downturn in export sales, up from a quarter of businesses three months earlier. A further 38% said sales had remained the same during the last six months of last year.

The study, carried out by Belfast-based Perceptive Insight for the Chamber, also found 40% of companies expected turnover to rise this year. On profitability, the companies were almost evenly split between those expecting sales to increase and those projecting a downturn.

On overall sales throughout the UK, a quarter said these had increased, 29% reported a decrease and the rest reported no change in the last quarter compared to three months earlier.

Ms McGregor said: "What the survey shows is that most exporters are effectively treading water, some are beginning to experience a slowdown in business."

Angela McGowan, chief economist at the Northern Bank, said this year would be challenging for international trade but export-led growth would be a key means to recovery.

"The slippage in sales in the last quarter of 2011 is not entirely surprising given the impact of the debt crisis in Europe and its impact upon both uncertainty and exchange rates," she said.

"However, temporary problems should not deter government from tackling any barriers to export and supporting businesses or sectors which are seeking opportunities overseas."

The survey also found that 60% of companies said employment levels had remained constant in the final quarter of last year, a similar result to the previous quarter.

Companies seeking recruits reported difficulties in key areas like experience and skills and 58% said finding suitable professional staff had been problematic.

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