A marriage of convenience between industrial development bodies in Northern Ireland and the Republic could create a radical new all-island economic strategy that would deliver jobs and investment for both sides of the border, according to the one of the North's leading economists.
Mr Mike Smyth, senior lecturer at the University of Ulster, said there had never been a stronger case for the integration of industrial development efforts on the island.
He was advocating a radical new approach to economic development that would, for the first time, see Northern Ireland and the Republic working hand- in-hand to attract new inward investors and stimulate indigenous industry.
"It makes sense because the Republic's critical mass of high foreign-owned industries, together with its favourable corporate tax regime, give it a comparable advantage in terms of foreign direct investment," Mr Smyth said.
"But Northern Ireland has a labour supply that can contribute meaningfully to meeting the needs of a fast-moving, knowledge-based industrial mix across the island. It is also better at growing indigenous businesses than the South."
He said the clear motivation for integrating the two separate industrial development strategies should be driven by the fact that both Northern Ireland and the Republic would each derive measurable economic benefit from it.
"We have to be realistic - even since the terrorist ceasefires and the peace process, Northern Ireland cannot compete against the IDA for foreign investment. Even if Northern Ireland puts its troubled political past behind it and is able to project a positive, peaceful image to overseas investors, it cannot compete with a more favourable tax regime across the border," Mr Smyth said.
He said the Republic also had issues to contend with when it came to wooing investors.
"Once the American economy recovers, Ireland will have to again deal with the issue of labour availability and skills shortages - Northern Ireland holds the answer to that problem."
He believes political leaders on both sides of the border should look closely at other European countries to see how the integration of different industrial development policies has worked in practice.
"The Benelux economies are a good example of how this worked in principle. The Brussels corridor has created wealth and prosperity and this has been underpinned by the introduction of the euro, which has in effect removed any debate over sovereignty issues," Mr Smyth said.
He admitted that any proposal to integrate economic development strategies on the island of Ireland would not win popular support among Unionist politicians in the North.
"This is fundamentally not about political ideology. The real issue is whether members of the Assembly across the board in Northern Ireland would see the wider picture and whether also the government in the Republic would be prepared to relinquish some sovereignty over industrial development," Mr Smyth said.
