Belfast Telegraph

Northern Ireland's economy 'needs to play catch-up'

By Damian Clarkson

UK economic growth slowed more than expected in the three months to September - but is still outshining the meagre expansion in Northern Ireland, official figures show.

News that growth has slowed UK-wide has eased pressure on the Bank of England to raise interest rates.

Analysts had forecast that growth would slow slightly from 0.7% in the second quarter to 0.6% in the third quarter - but figures from the Office for National Statistics (ONS) put third-quarter growth at just 0.5%.

Dr Esmond Birnie, chief economist with PwC in Northern Ireland, said the decline disguised variations across sectors. The services sector had grown by around 0.7%, while construction had fallen 2.2% - and manufacturing also declined by 0.3% thanks to the strong pound and subdued euro growth.

Nonetheless, the UK economy was still growing steadily and would expand by around 2.4% in 2015, Dr Birnie said. But he added: "This is not being reflected in Northern Ireland where our forecast for growth in the local economy in 2015 would be less optimistic at 1.7%, declining to 1.6% in 2016."

UK GDP is now 6.4% above its previous peak - while in contrast, earlier figures had shown that Northern Ireland output was 8% below its 2007 peak.

"This is an indication of just how far the local economy is lagging behind the UK recovery and illustrates just how much work needs to be done to close the gap," said Dr Birnie.

While UK expansion was lower than expected, it is nevertheless the 11th consecutive quarter of growth.

Belfast Telegraph

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