Manufacturers: Don't let global wobbles halt business
Manufacturers in Northern Ireland must not allow themselves to be put off by wobbles in emerging global markets, an industry leader has said.
Stephen Kelly of Manufacturing NI spoke as the latest inflation report from the Bank of England said that gloomy global growth and weakness in emerging markets had led to a delay in an anticipated interest rate rise.
Its Monetary Policy Committee has voted to keep interest rates at their six-year low of 0.5%. And Governor Mark Carney said an interest rate rise was now likely to be delayed until 2017 - contradicting earlier indications that a rate increase would happen earlier next year.
Fragile global markets have had an impact on some of Northern Ireland's biggest manufacturers, including tyre giant Michelin, which this week announced it was pulling out of Ballymena due to falling truck tyre sales in Europe, high energy costs and cheaper competitors from Asia.
And equipment giant Caterpillar - which employs around 2,000 people, mainly in the manufacture of generators in Northern Ireland - has also said "challenging marketplace conditions" in mining and energy have had an impact on its operations, leading to restructuring and cost-cutting. It has suffered from falling equipment sales in North America, Latin America, Europe, Africa, the Middle East and Asia Pacific.
And Bombardier has also suffered the effects of strong competition in global markets as it seeks sales of its new narrow-body jet, the CSeries.
But Mr Kelly, the chief executive of Manufacturing NI, said that wobbles in some global markets did not necessarily mean bad news for the entire manufacturing base.
"It would be a lot easier for us all to be in a world where all markets were growing but I wouldn't be jumping up and down and concerned too much for the majority of our manufacturing base right now," he added.
The world's biggest manufacturers are dependent on good global growth but "for the majority of our manufacturing SMEs, their biggest desire is for continued growth in the Irish economy, which is their biggest export market, and the UK," Mr Kelly said.
Others - such as equipment firm CDE Global in Cookstown - have spread their interests in a number of markets.
"They have spoken about how they are in Brazil, the Middle East, Russia, Africa and Australia," Mr Kelly told this paper. "And they've said that while Brazil and Russia are slowing, Australia is growing."
The inflation forecast notes that financial markets have pushed their expectations for a rate rise forward to the first half of 2017 from the middle of 2016 at the time of the August report. This follows a summer of market turmoil amid concerns over China's slowing economy.
But United States Federal Reserve chairwoman Janet Yellen said yesterday that a US rate rise in December is a "live possibility".
The Bank said the outlook for global growth had weakened since its last inflation report in August, with some emerging economies having "slowed markedly".
Number of people Caterpillar employs in Northern Ireland