Exports to Republic help boost NI economy

Further evidence of a business upturn in Northern Ireland emerged in Ulster Bank's purchasing managers' index (PMI) figures for December, released yesterday.

The rates of growth in both output and new orders reached their highest levels for the year. Staffing levels rose, on average, for the second month running.

"The new year's message from the PMI is one of hope and prosperity as both output and new orders ended the year on a high note," said Ulster Bank chief economist Pat McArdle.

"They were driven by stronger export demand, particularly from the Republic of Ireland, while at home there was evidence of more promotional activity, mainly in the form of cuts in prices."

He said that with activity in the UK and the euro zone also set to accelerate and another reduction in the Bank of England's interest rates still on the cards, the outlook was more promising than it had been for some time.

"Lest we get too carried away, however, we should note that the private sector business activity index average for 2005, was the lowest in the survey's three-year history.

"Northern Ireland, in turn, had the third-lowest reading of the 12 UK regions with only eastern England and the East Midlands below it last year," said Mr McArdle.

"The employment performance was better, as firms in Northern Ireland were less inclined to shed labour - only three other regions reported a stronger performance and almost half of all regions experienced job losses in 2005."