Widespread nervousness among businesses
The latest quarterly InterTradeIreland Business Monitor Report (July – September 2016) paints a mixed economic picture that reflects a widespread nervousness and sense of uncertainty among the business community in Northern Ireland and Ireland.
Lowest growth level for three years
While 32% of businesses still say they are growing, this figure is at its lowest level for 36 months. Conversely, there has been a small increase in the numbers reporting that growth is declining which points to more of a slowing in overall growth than any signs of contraction at this point. Sales figures also show a positive though declining balance.
Issues facing businesses
Rising costs is the biggest issue now facing businesses pointing to the emergence of inflationary pressures. However, for those involved in cross-border trade and export activity, currency exchange rates between sterling and the Euro are the biggest issue they face, with 45% reporting it as a key issue. Surprisingly the issue is high for both Northern Ireland and Ireland exporters, indicating the strong supply chain linkages across the border.
The palpable sense of uncertainty is captured in the fact that almost the same amount of Northern Ireland businesses think a UK exit from the EU will have a negative impact on cross-border sales (23%) as those believing it will be positive (20%). In Ireland, almost half (46%) of firms believe cross-border sales will be negatively impacted with only 9% believing it will be positive.
Planning for the unknown is difficult
Uncertainty is further reflected in the fact that 97% of businesses across the island have no plans in place to deal with a UK exit from the EU. 91% of cross-border traders have no experience dealing with tariffs and 80% of businesses still say TV news is their only source of information about Brexit.
InterTradeIreland can support SMEs across the island
Against an economic backdrop that is slowing there is undoubtedly a role for InterTradeIreland to help businesses, primarily those small businesses that are trading or have the potential to trade across the border. Information gaps are perhaps hindering their development planning.
InterTradeIreland will be holding breakfast briefings where they will share advice and information to help SMEs prepare for new trading relationships that emerge from Brexit negotiations. InterTradeIreland will also be launching Brexit Readiness vouchers which will offer companies financial support towards professional advice in areas such as sales and marketing, tariffs, currency management, regulation, tendering, finance, taxation, and employment law.
About Business Monitor
InterTradeIreland’s quarterly Business Monitor survey is the largest and most comprehensive business survey on the island and is based on the views of more than 750 business managers across Northern Ireland and Ireland. Business Monitor differs from other surveys in that it is seen to be the ‘voice of local businesses’ feeding directly from telephone interviews conducted with firms of all sizes from across a range of sectors to track all-island economic indicators such as sales, employment, business outlook and other specific topical research areas on a quarter by quarter basis.
For more information on InterTradeIreland and its business support programmes, please visit www.intertradeireland.com. A copy of the 2016 Q3 InterTradeIreland Business Monitor Executive Summary can be viewed at: http://www.intertradeireland.com/researchandpublications/business_monitor/