GROWTH IN the Northern economy will be sluggish and the new Executive will face a series of challenges in dealing with the region’s ingrained economic problems, an economic survey has found.
The Northern Bank’s quarterly survey, released yesterday, forecast more low-level growth with just a small chance of a double-dip recession.
Despite a host of problems, it reported that some sectors of the Northern economy were performing steadily if not spectacularly. Manufacturing growth is forecast to hit 4.3 per cent, agriculture is set to rise 3.9 per cent and the personal services sector will grow by 2.6 per cent. Meanwhile transport and the hospitality sectors will rise by 2 per cent and 1.9 per cent respectively.
The bank, which is part of the Danske group, pointed to voters’ expectations after the May 5th Assembly elections that the new Executive would tackle the highly problematic economic situation.
“A number of difficult decisions will need to be made,” the bank warned. “Discussions on reducing corporation tax have progressed considerably and will likely need action. The Executive will also have to encourage general recovery and private sector growth, whilst restructuring the economy, however additional funding from Westminster is extremely unlikely.”
It warned that Northern Ireland “must solve its own problems”, adding that this would be a sizeable challenge for the Executive to face.
The bank found that the Stormont parties appear united over the aim to reduce corporation tax, but warned that “other policy aims appear lacking in detail with regards to how they might be funded”.
“There is no doubt the Executive face a challenging term in government, there will be little money to throw at the growing problem of unemployment and there will be no more voter-friendly giveaways, indeed quite the opposite, with local tax rises a very strong possibility.”
It said that the forthcoming economic strategy from Arlene Foster’s Department of Enterprise, Trade and Investment is eagerly awaited to see if there are any fresh ideas. Any future recovery “will be all about self-help”, it warned.