THE possibility of recession in Northern Ireland has been highlighted by the latest quarterly survey on the economy by the First Trust Bank.
It forecasts economic growth slowing to 1 per cent this year, with a limited recovery in 2000.
The findings follow last week's pessimistic forecasts by Price waterhouseCoopers which warned that the Northern Ireland economy was "on a knife-edge", with some sectors expected to be on the edge of recession by the end of the year.
The First Trust report says there is a likelihood of further job losses in manufacturing, particularly in sectors such textiles, which are vulnerable to strong international price competition.
It says that although sterling has weakened recently, it is still "overvalued and uncompetitive", and predicts further cuts in interest rates. In spite of the gloomy predictions, the survey says the unemployment rate will remain at around 7.3 per cent.
However, the report says there has been an increase in economic uncertainty in many parts of the Northern Ireland economy recently, due partly to the continued political negotiations, and partly to the economic problems in Russia and the Far East.
But should the UK avoid recession, the report says the local economy will recover, and growth could be as much as 2.5 per cent in the year 2000. In the Republic, growth this year is likely to be around 7 per cent, falling to 5 per cent next year.
