Banks in Northern Ireland must be prepared to lend more if the private sector is to lead the economic recovery, the North's Minister for Finance Sammy Wilson will stress today.
Mr Wilson will use his address at the 2010 Northern Ireland Economic Conference to call on both financial institutions and the London and Dublin governments, with their powers over banking policies, to do more to help business owners in the region.
Ahead of the event in the Culloden Hotel in Holywood Mr Wilson said evidence suggested bank lending in Northern Ireland has not recovered as quickly as it has in other parts of the UK.
“It is clear that the availability of finance and the challenges facing the banking sector are affecting confidence and remain a constraint to growth here,” he said.
“Even though banking issues are reserved the question of access to finance is key to our recovery.
“The private sector will not replace public sector investment if it cannot get the money or if it decides that the cost or risks associated with borrowing mean that investment decisions should be postponed.”
The Minister added: “For our economy to grow it is vital that lending of this nature improves here, especially due to our reliance upon SME businesses which depend heavily on bank lending.”
“The banking and access to finance issue is key for now and I will keep at this with London and with Dublin. I am determined that we don’t talk ourselves into a downward spiral of recession. This is what I understand by the public sector leading the recovery. This is what I will try to achieve as finance minister.”
Mr Wilson said he welcomed the UK coalition Government’s commitment to examine measures that would boost the region’s economy. Proposals from Westminster are expected later in the autumn.
He also reiterated his call on fellow executive minister to work with him to make sure Northern Ireland’s economy can recover despite the looming £2 billion cuts to the block grant.
“Growing the economy is the Executive’s top priority and I will continue to work with all other Executive Ministers to reflect this in our decisions as we make the necessary reductions in our expenditure,” he said.
“We know that the structure of our local economy is fundamentally unbalanced with too great a dependence on the public sector. It is now vital that we focus on growing the private sector. The Executive will do that in its own Economic Strategy.
“I welcome the new Government’s commitment to work along with the Executive to grow and rebalance our economy.
“This regional approach has been long missing from Whitehall and we can take some encouragement from its return.
“For me, it is the other side to the cuts story that we hear less about. We have to work with the new Government, and to press them if necessary, to make it real and worthwhile.
“We will work to an outcome here where the coalition Government is clear that they must help to build confidence in the rebalancing of our economy with the use of the policy levers they control whether corporation tax, enterprise zones or other options for reform.”
PA