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Northern Ireland Economy facing choppy waters but 'will likely dodge recession'

By Margaret Canning

Published 02/12/2016

Professor Neil Gibson, director of the Economic Policy Centre at the University of Ulster
Professor Neil Gibson, director of the Economic Policy Centre at the University of Ulster

Uncertain times lie ahead for the Northern Ireland economy despite growth across many sectors this year, a respected report has claimed.

Ulster University's Winter Outlook noted there had been positive jobs growth in many industries, suggesting a degree of resilience in the economy.

But Professor Neil Gibson, director of the university's Economic Policy Centre, said business investment was likely to slow down next year.

However, he also claimed that Northern Ireland would avoid a recession, largely thanks to consumer spending.

"Tourism and retail spending, driven by the depreciation in sterling, should partially offset the slowdown in business investment," Mr Gibson explained.

The outlook forecast GVA (gross value added) growth of 0.9% next year, compared to 1.9% this year. It also predicted house price growth of 4.7% next year, 2.4% the year after and 6.2% following that.

Mr Gibson said the Northern Ireland economy faced many dangers thanks to the impact of the Brexit vote and the potential ramifications of Donald Trump's election as US President.

He also insisted there would be no certainty for the UK economy until the details of post-Brexit trade deals became known.

For Northern Ireland, Mr Gibson claimed that the future status of migrant workers and the border would be more important than trade deal details.

In the meantime, consumers appear happy to proceed as normal in the absence of any detail about the content of Brexit discussions, Prof Gibson told the Belfast Telegraph.

"The Prime Minister has said she won't be providing running commentary on Brexit," he said.

"The early evidence would suggest that as long as there isn't actually anything we need to know, people are just prepared to continue as normal. So perhaps not knowing isn't such a bad thing."

Mr Gibson additionally warned that in the long run, the Executive needed to do more to support businesses and help them to invest.

"It is important that the Executive remains focused on addressing the long-standing economic challenges of Northern Ireland," he said.

"Non-student inactivity rates, low productivity and the high numbers of school leavers with low or no qualifications have persisted for many years.

"As a result, the key outcomes in the Programme for Government remain a priority inside or outside the EU."

Prof Gibson also revealed that his university's Economic Policy Centre planned to create a new policy institute.

He said the aim of the organisation would be to unite academics and government representatives in the hope of helping achieve the objectives laid out in programmes for government.

Belfast Telegraph

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