Province's housing market 'could languish until 2020'
Northern Ireland can expect the lowest growth of all the UK regions this year and next and may not see the housing market recover until around 2020, according to a new report.
The latest Economic Outlook document from economists PriceWaterhouseCooper said Northern Ireland will see falling employment and little growth well into 2013.
The region will languish behind the other 12 UK regions, with the housing market flat and export markets remaining difficult as the eurozone crisis constrains demand in increasingly competitive market conditions.
PwC's assessment of the UK property market also confirms Northern Ireland house prices are continuing to fall and, in a special report on the UK house market, warns that they may not return to pre-crash levels till after 2020 - if at all.
However, PwC's chief NI economist Dr Esmond Birnie said, despite the gloomy forecast, the news is not all bad.
"Unemployment is rising but remains below the level experienced in previous downturns," he said.
"At the same time, inflation should fall back towards its 2% target rate over the next year unless there is a significant resurgence in global commodity prices.
"This will boost real consumer spending power, which was severely squeezed in 2011 as prices rose much faster than earnings.
"And while Northern Ireland faces negative growth of around 0.4%, 2013 should bring the region back to growth of just over 1%.
"However, a decision on devolving corporation tax varying powers has been deferred again and there are concerns that the Treasury and the Executive may not reach an agreement on the cost and practicalities of devolving the relevant powers.
"If that happens, the Executive may have to look to Scotland or Wales to see what lessons can be learnt from those regions in terms of devolving other tax varying powers."
Overall the UK's economic growth will be virtually zero throughout 2012, and it will show only modest recovery in 2013 - with that growth being led by London and the South East.
The UKEO report projects UK-wide GDP growth of around zero in 2012 as a whole, but picking up later in the year and rising to around 1.7% in 2013.