Warning of threat to global economy as experts watch financial storm clouds over China
A Chinese recession could rock the UK and Irish export markets, if fears of a financial crisis in the global powerhouse are realised, it's been claimed.
As growth in China slows, economists are increasingly in agreement that a Chinese recession looks to be on the cards.
China's economy grew 6.9% in the third quarter of this year, the weakest rate since the global financial crisis began in 2008.
Speaking at a breakfast event, Bank of Ireland UK economist Alan Bridle said comparisons could be made between patterns seen in European countries in the lead-up to the financial crisis and China's current slowdown.
He said that a rapid rise in the percentage of borrowing compared to GDP had also been typical in several countries in the lead-up to the 2008 recession.
In 2008, Chinese borrowing was 31.67% of GDP - but that figure has risen by 10% over the past seven years.
Last year, Northern Ireland's manufacturing exports to China totalled £95.5m, a small part of the region's £1.5bn total exports.
Mr Bridle said: "In the next five years the world economy will be more dependent on the States, than it has been in the past few years, and less on China."
However, despite the region's success in manufacturing products for use in China's mining and oil industry, Mr Bridle said the damage of a Chinese recession to the Northern Ireland economy would be limited.
Mr Bridle said that the Republic of Ireland was likely to be hit harder than Northern Ireland in the event of a Chinese crash, because of the country's even heavier reliance on Chinese trade.
He said: "As long as the UK economy continues to grow and the Irish economy continues to grow, Northern Ireland will be OK."
And Ian Sheppard, Bank of Ireland's head of business and corporate banking, said the political deadlock here is not a worry to Northern Ireland business owners.
Mr Sheppard said: "Low costs are more of a factor at the moment and lower exchange rates are more of a challenge to businesses right now.
"If I ask about the things people are worried out with their businesses, politics doesn't tend to be a factor."
Opportunities in the Chinese market were highlighted last week by Enterprise Minister Jonathan Bell at a food celebration event, where he told producers he would up Northern Ireland exports to China to over £100m.
China and the US have increasingly been driving growth in the world economy.
Together the countries were responsible for over half of economic growth in recent years.
However, a slowdown in the east could lead to China losing ground in the world marketplace.
Last week Irwin's Bakery in Portadown became the first Northern Ireland firm to announce an export deal to China since signs of difficulties first emerged in its economy.
Irwin's is set to send 500,000 packets of biscuits to be stocked in China Merchants Food Stores across China. The retailer is part of the state-owned China Merchants Group.
Other Northern Ireland firms which export to China and have a strong interest in its economy include Wrightbus in Ballymena, dairy giant Dale Farm and medical diagnostics firm Randox.