Economic growth in North 'to run close to 2%'

The economy in the North is expected to grow by close to 2% this year despite the continuing global economic downturn and credit crunch, a report predicted today.

After continuing growth since 1983 the economy there is forecast to contract by 0.4% compared to the growth of 5.3% enjoyed in 2007, said the report.

The Department of Enterprise, Trade and Investment’s latest Quarterly Economic Review forecast “relatively robust” growth of 1.8% for the North.

However that is well down on the 3.5% achieved in 2007.

The report said: “The current global economic conditions will have an inevitable impact on Northern Ireland’s economic performance.

“Although growth is forecast to decline in 2008, it is expected to remain relatively robust at around 1.8%.

“A strong labour market and recent success in foreign labour market and export markets, should help limit the impact of the slowdown on the economy.”

Economy minister Arlene Foster said that although businesses faced a range of economic difficulties, the economy in the North was reasonably well placed to “weather the storm”.

Commenting on the review she said: “This is clearly a very challenging period for businesses in Northern Ireland particularly as the impact of the global economic slowdown takes effect.

“At a time when firms are already suffering from the fall-out of the ’credit crunch’, rising oil and energy prices are particularly unwelcome. Moreover recent reductions in house prices have dampened consumer confidence.”

However she said that despite the economic difficulties the local economy was still forecast to grow in 2008.

“The strength of the labour market, where the number of employee jobs stands at an all time high of 722,120, coupled with increased investment in R&D, will help many local firms retain their competitive position,” she said.

Highlighting recent inward investment successes, the minister said while businesses in key investment markets in the US and Europe were feeling the impact of the slowdown, recent announcements – such as Bombardier Aerospace’s half a billion investment in Northern Ireland – illustrated overseas investors continued to have confidence in the economy.

Mrs Foster added: “Since becoming Economy Minister I have been greatly encouraged by the potential and the determination that lies in indigenous businesses.

“Having made a number of company visits across Northern Ireland, I am impressed by their focus on the long-term future, including plans to expand and improve their export potential.”