The Northern Ireland section includes key facts, Top 25 companies ranked by turnover, transport statistics, political tables and regional contacts.
This is an extract of the Northern Ireland section of UK plc
A normal society
The restoration of devolved government in Northern Ireland on 8 May 2007 has ramifications far beyond the political landscape. The agreement between historic enemies, the ultra-unionist Democratic Unionist Party and the republican Sinn Fein parties, has put the long-stumbling peace process on its firmest footing yet and created an air of confidence in the general public as well as the business community.
While the new administration has yet to face the white heat of tough political decisions – which could reveal inherent fault lines – its sheer existence is a cause for optimism that Northern Ireland is entering a new, more prosperous phase. Most of the indicators underline that confidence.
Unemployment is at record low levels and at 3.7 per cent is the lowest of the UK regions, a far cry for the not so distant past when Northern Ireland was the unemployment blackspot in these islands.
House prices continue to soar, up 51 per cent in the last year to an average price of £240,400, a figure higher than anywhere else in the UK except the southern parts of England. The high price of property reflects both the huge demand for homes in the region and also the influence of mainly Republic of Ireland investors on the property market. House prices in the Republic have begun to stagnate, or even fall, and investors have decided to look across the border for new opportunities.
Retailers are also big investors in Northern Ireland. The opening in December 2007 of iconic Swedish brand IKEA’s first Irish store in Belfast, to be followed in spring 2008 by the £320m Victoria Square mixed-use shopping, leisure, and residential complex, which will include the prestigious House of Fraser, shows the confidence of that sector in the future of Northern Ireland. John Lewis is also continuing its long running battle with the planners to establish a Northern Ireland base.
However, confidence in the economic future has still to be tempered with realism. Northern Ireland has a huge reliance on the public sector and its record unemployment low is largely due to growth in the low value service sector. Its economy is underpinned by the annual subvention from Exchequer to the value of £6bn to £7bn.
Given the historic nature of the political developments this year, there were high hopes of a fiscal bonus from Westminster, but the new Prime Minister Gordon Brown has shown little inclination to loosen the purse strings. While much was made by the UK government of the “peace dividend” of £1bn directed to the province, it was largely a smoke and mirrors exercise consisting of money pledged by the Republic of Ireland government; accelerated public asset disposals, the ability to roll-over unused funding from one year to the next and funding to defer the introduction of water charges. Ultimately the package contained only a small amount of new money.
One measure which a wide range of economic and business gurus feel could transform the Northern Ireland economy from one overly reliant on public sector spending – which is due to be curtailed over the next three or four years – to a more entrepreneurial spirit is the reduction in corporation tax to 12.5 per cent, the same as the Republic of Ireland. This measure is widely credited as a catalyst for the Celtic Tiger economy in the Republic which saw many multi-nationals set up their European bases there.
It is those kind of high value jobs in areas like IT and financial services that Northern Ireland desperately needs to attract if it is to create a more balanced economy. However, the Prime Minister is reluctant to make Northern Ireland an exceptional case in UK taxation, although he has set up a task force to examine the issue. Not many people expect that task force to recommend lowering the corporation tax rate in the province.
While there is a general air of optimism about the future – it could hardly be otherwise given the bleak past – there remains some structural faults in the Northern Ireland economy which require radical intervention. But, at last, it seems political and public debate will concentrate more on economic and social issues rather than on constitutional issues and that, perhaps, is the greatest indication that Northern Ireland is becoming a normal society.
Laurence White is a freelance
business journalist based in Belfast