Political coherence is now needed to match Invest NI's brave new strategic plans
Invest NI has refreshed its strategy to help build a stronger regional economy. The challenge now is to assist somewhere between 16,000 and 24,000 jobs by 2021.
The flow of business investment into and across western Europe has slowed. Investors can easily be deterred by uncertainty and the macro-economic management of western European economies faces a series of tensions which have serious implications. Northern Ireland is as vulnerable as other places.
Trading prospects have become more uncertain and, in consequence, investment and location decisions may be delayed or even changed. The American administration is contemplating changes in its corporate taxation. 'Buy American' potentially could reduce the flow of American investment in western Europe.
But the growing uncertainty can be strongly influenced by events from within western Europe. Hanging threateningly is the long list of questions about Brexit. Will the UK stay out of (or be forced to stay out of) the single market and customs union? If the UK is outside these arrangements that may mean extra costs.
A related question asks whether the UK will seek to formally retain the common technical and other trading standards as they have developed in the EC. Customers have become increasingly familiar with the CE trademark on many goods.
The assurance of standards that are recognised across the EC is a useful trading support. But, there is no certainty that the UK will maintain these standards. Possibly, some will want to demonstrate that the UK should set its own standards. That is fraught with disruptive consequences.
Uncertainty is growing in international finance businesses. Will the shared EC arrangements which give banks and financial organisations flexible 'passporting' rights be retained or modified? The expectation is that they will be constrained.
This has the consequence that, as an English speaking commercial community, more of these businesses may migrate to Ireland, usually Dublin. Alternatively Frankfurt and Paris have both well publicised ambitions.
Existing Northern Ireland businesses are not heavily involved but the attraction of international finance operations may be less successful. Into this more uncertain business environment, Invest NI has refreshed and relaunched its strategic agenda with a range of improvements that have the potential to deliver better results.
The theme is to deliver 'outcome-based accountability'. Invest NI will focus more heavily on 'outcomes' rather than 'inputs' in the search for improved performance. The central jobs achievement indicator will be measured by the number of assisted jobs; not by jobs promoted. This is much more than a play on words: assisted implies direct commitment, whereas promoted has always been a best expectation.
Invest NI has managed to put together a structured strategy drawing on consultation for a Northern Ireland industrial strategy. The original official strategy document was unimpressive in coherence and conviction. Invest NI has adapted and rearranged key issues raised by the five pillars, set out a more detailed agenda and now given the strategy much improved credibility.
The scope for a changed and improved delivery strategy for Invest NI is heavily influenced by two dimensions. First, until the Brexit negotiations are concluded, Invest NI must continue to operate under the EC State Aid rules which have generally given regions like Northern Ireland a useful shield in attracting investment. Second, taking a longer perspective, after the exit from the EC, the prospect is that within the UK, Invest NI may have scope to introduce new development incentives outside the limits of State Aid control.
In that new situation, local policy makers will have opportunities that call for imaginative and effective new policy levers. Invest NI has indicated that mindset is being tested.
The new strategy is welcome but will Northern Ireland have the necessary political coherence?