Belfast Telegraph

SMEs hit hardest by drop in exports

Exports by Northern Ireland companies to Europe and the Republic have fallen by over 8%, a government report on manufacturing has shown.

The manufacturing, sales and export survey for April 2009 to April this year reveals that small businesses have borne the brunt of the downturn in exports and have faced a 22% fall in sales.

Medium-sized firms have had to confront an 8% fall in export orders while orders for big businesses have dropped by 11%.

Total sales, both exports and internal sales, were estimated to be worth £15.7bn, a fall of 0.4% on a year earlier.

The fall contrasts with an improvement on that year when manufacturing had shown healthy yearly growth of nearly 5%.

Sales by Northern Ireland firms of all sizes into the Republic of Ireland were down 6% to £99m, in contrast to a year earlier when sales went up 2%.

But a £487m fall in exports was mostly due to falling orders from the rest of the European Union.

That market accounted for 83% of the total loss.

While the survey said excluding the effects of currency changes and inflation, all sales were down 3%, sales to Great Britain - the Province's main sales market -had grown by 6.5%.

Bryan Gray, head of industry group Northern Ireland Manufacturing, said: "I suspect the increase sales to Great Britain is principally because the construction sector in Great Britain hasn't seen the same downturn as it as here. I have heard construction bosses here say: 'Thank God for the UK, or I would be completely out of business'."

Mr Gray added: "Overall, the figures reflect the experience of our members. The only thing which they don't reflect is that many companies are continuing to trade at a loss in an effort to keep their workforce in employment and to keep cashflow up to keep their bankers happy. Banking and finance continues to be a serious problem."

Manufacturing includes construction products, food, furniture, light and heavy engineering and others.

Food, beverages and tobacco accounted for the biggest proportion of exports, followed by transport equipment.

The difficulties in Northern Ireland manufacturing contrast with improvements in the UK. The latest industrial trends survey from the CBI showed 25% of companies reported above- normal export orders, the strongest result since 1995.