Tuesday 22 May 2018

North is main export target for the majority of firms here

Titanic Belfast. Photo: Deposit
Titanic Belfast. Photo: Deposit
Colm Kelpie

Colm Kelpie

Northern Ireland is the main export destination for just over half of Irish exporters, a new Government-backed report has found.

The report clearly highlights the importance of maintaining an open Border after Brexit.

Cross-Border body InterTradeIreland says that for many Irish exporters, Northern Ireland is the destination for more than 50pc of their exports.

"The large spike at the highest bucket of the export graph demonstrates that for a considerable percentage of Irish exporters, Northern Ireland is their most important destination," its report notes.

"Although we do not have the same level of detail at the firm level from Northern Ireland, there is little reason to think that very similar patterns would not also be observed if a direct comparison could be made."

But even though there are a large number of firms that rely on Northern Ireland, there is an almost equal percentage that sell very little north of the Border.

Around 23pc send less than 10pc of their export output to the North.

For around 45pc of firms importing from Northern Ireland, the imported amount makes up less than 10pc of the firm's total imports and for a minority, about 7pc to 8pc, Northern Ireland is the origin of more than 90pc of imports.

Northern Ireland accounts for between 10pc and 12pc of total exports from Ireland to the UK as a whole, and accounts for 7pc to 8pc of imports.

Read More: EU report warns of 'zero progress' on Border question

The study points out that given that the population of Northern Ireland makes up less than 3pc of the UK total, this shows the closeness of the economic ties between the two jurisdictions.

InterTradeIreland, which carried out the research, said it hasn't examined the data by firm size. But it added that the data used is from Intrastat returns (VAT registered traders), covering 880 firms, and by its nature relates to companies exporting to a value of €635,000 or more.

"As such we would consider that many micros/smaller firms are not captured within this," a spokesperson said.

Aidan Gough, InterTradeIreland director, said the report shows the disproportionate importance of cross-Border trade for businesses across the island and the high degree of interconnected supply chains.

"The integrated nature of the supply chain and strength of cross-Border trading relationships means that for many firms, the all-island economy becomes a ripe test-bed for new product innovation," Mr Gough said.

"There are fewer barriers to innovation because of previous supply-chain knowledge and experience of bringing a product to market."

Business, Enterprise and Innovation Minister Heather Humphreys said the study is a welcome contribution to our understanding of the context around Brexit.

"What emerges clearly from this research is the high degree of integration of the economies North and south. It illustrates that the cross-Border market is dominated by SMEs, and that the ability to transport products, source components and sell services across the Border in a seamless way is essential to thousands of business models."

Mr Gough said companies should focus less on the ongoing "noise" in the media about the negotiations, and more on planning for a new trading relationship.

It comes as a separate UK government study has warned trade between the UK and 70 nations risks "falling off a cliff edge" if Downing Street does not act quickly to roll over EU trade deals.

"The [UK] government is making much of the trade agreements it plans to make after Brexit, but first it needs to give us confidence that the existing agreements, on which businesses, consumers and trading partners alike rely, can be rolled over so the UK can benefit in its own right," said Angus Brendan MacNeil, chair of the International Trade Committee in Westminster.

"Unless an agreement is reached with our trading partners in the coming months, a significant economic price will have to be paid."

Irish Independent

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