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Northern Ireland manufacturers 'have not seen Brexit bounce'

By Staff Reporter

Published 23/09/2016

Manufacturing NI chief executive Stephen Kelly
Manufacturing NI chief executive Stephen Kelly

Northern Ireland's manufacturing sector is not witnessing the same Brexit bounce as the UK as a whole, it has been claimed.

There were further signs of an improvement in the UK economy as figures showed a robust performance from the manufacturing sector in September, according to a CBI survey.

But Stephen Kelly, chief executive of Manufacturing NI, said: "Our soundings are that those who export are seeing some benefit from the sharp change in the value of sterling resulting in some orders and customers returning.

"However, we have a small number of manufacturing exporters and the latest HMRC stats show that there was a further reduction in the number of firms exporting in the last year by almost 5%.

"The rest of the manufacturing sector locally is suffering from significantly higher input costs due to the slide in sterling with most of what we produce being sold at home and in Great Britain.

"So, the net effect locally is likely to be more negative than the CBI survey."

The latest CBI Industrial Trends Survey showed output holding firm in the three months to September, while manufacturers' output expectations for the next three months doubled to a three-month high.

The total order book balance remained at minus 5%, but was "well above" the long-run average, according to the CBI.

It added that the weaker pound was boosting demand for British products, with export orders also above average, despite easing back a little.

Its survey of 481 firms found that 33% of businesses reported a rise in output volumes and 22% reported a fall, giving a balance of plus 11% - the same as in August.

But 37% of companies expect a rise in output over the next three months and 15% expect a fall, resulting in a balance of plus 22%, the highest since June.

Rain Newton-Smith, chief economist at the CBI, said: "It's good to see that manufacturers are enjoying a lingering summer with output running at a strong pace and manufacturers' order books remaining solid, particularly amongst the food, drink and motor vehicles sectors.

"Our members tell us and our surveys show that the fall in sterling has boosted international competitiveness for many businesses, with export order books remaining well above average in September, despite weakening slightly."

The report showed that 16% of businesses reported export orders to be above normal and 26% below.

Belfast Telegraph

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