Brexit fears lessen among Northern Ireland firms, but no clarity on final deal a concern
Pessimism over Brexit among Northern Ireland firms is falling and is now less acute than among their counterparts in the Republic, according to a survey today.
The AIB Brexit sentiment index for the first quarter of the year said that local firms who were most anxious about the impact of Brexit tended to be manufacturers or tourism-related businesses.
However, the index found that only 2% of firms here have put a formal Brexit plan into place - compared to 4% in the Republic.
Firms on both sides of the border said they were putting off or even cancelling plans to invest - but despite their worries, most had yet to feel any impact.
Tourism and manufacturing firms were most anxious on both sides of the border, while in the Republic, food and drink firms were also nervous. Concerns included the implications of tariffs and how they would impact goods and services.
Stephen Kelly, chief executive of trade group Manufacturing NI, said he was not surprised that manufacturing firms were feeling concerned. "Whilst a small number of manufacturing firms export, every one of them imports from the EU and further," he said.
"They know they now face added cost and complexity brought on by customs, origin certification and a raft of other non-tariff barriers.
"They're also experiencing workers leaving and are having difficulty replacing them." But he said there could be a silver lining. "There is a chance for our sector and Northern Ireland to prosper by being a bridge between the UK and the EU.
"That would make us one of the most attractive regions in the world to invest and would create jobs and put money in pockets across Northern Ireland."
Retailer John Keenan of Bogart Menswear, which has stores in Belfast and Newry, said he was taking a direct hit. "Around 90% of my goods come from Europe and the weakening of sterling since the EU referendum has made these goods much more expensive. It is very difficult to pass on all this additional cost to the customer, so our margins have taken a hit."
Brian Gillan, head of business and corporate banking at First Trust, said: "Whilst this is the third consecutive improvement in sentiment expressed by SMEs in Northern Ireland, the lack of visibility and uncertainty still prevails, as reflected in the border issue, but perhaps the growing optimism reflects the progress made over the last quarter and a belief that both sides will get a satisfactory deal done."