5 June 2015

  |  CBI Northern Ireland

News

The economy's growth path tops agenda at CBI NI lunch

Over 130 senior business leaders attended the CBI’s Annual Economic Briefing today (4 June 2015) at the Hilton Hotel Belfast, which included insights from Rain Newton Smith, CBI Economist and Alan Bridle, UK Economist & Market Analyst for Bank of Ireland (sponsor).

The economy's growth path tops agenda at CBI NI lunch

Following her presentation on UK and international outlook, Ms Newton-Smith said:

“As we move through the second quarter, growth has cranked up several gears and businesses expect that faster pace to continue. This supports our belief that the weaker-than-expected GDP growth in the early months of 2015 will be short-lived.

“A stellar increase in activity in the business and professional service sector and retail sales bounding ahead are clear indications of strong business and consumer confidence and increased spending power.

“UK exports are likely to be helped by renewed momentum in the Euro area but the stronger pound and weak demand in many overseas markets continue to pose challenges.

“Inflation turned negative in April with the lowest reading since the 1960s. But it’s unlikely we will see falling prices for a prolonged period, as the downward pressure on inflation from lower oil prices fades.

“With inflation set to remain below 1 per cent this year, a rise in interest rates anytime soon seems off the cards. Rates are likely to remain low into next year and beyond, continuing to help the domestic recovery.

“Public borrowing decreased by £11.1 billion in the last financial year and the government borrowed £2.9 billion less than the Office for Budget Responsibility (OBR) forecast. The government’s deficit as a share of GDP has halved during the course of this parliament.

“There is still plenty more to do though, so the newly elected government is right to continue to prioritise deficit reduction - sound public finances are vital both to supporting business confidence and funding sustainable public services – as well as promising a productivity plan in July’s Budget.”

Giving a Northern Ireland specific focus to the event, Alan Bridle, UK Economist & Market Analyst for Bank of Ireland said:

"The job-rich nature of Northern Ireland's recovery in parallel with a period of zero inflation have helped drive a period of consumption-led growth although in common with the UK overall and many other economies, future prospects for the region's living standards will depend much more on reversing the post-crisis trend in productivity. 

“With the public sector entering more straitened times, the resilience and capacity of Northern Ireland's private sector will be tested over the next few years if growth is to be sustained. With high competitive intensity in crowded domestic sectors, the continued strong performance of our external-focused businesses will be absolutely crucial, as will sustaining momentum in FDI.

“Realistically, the region's growth path will continue on a lower trajectory than UK and ROI."

ENDS

Notes to Editor

Across the UK, the CBI speaks on behalf of 190,000 businesses of all sizes and sectors which together employ nearly 7 million people, about one third of the private sector-employed workforce. With offices in the UK as well as representation in Brussels, Washington, Beijing and Delhi, the CBI communicates the British business voice around the world. The CBI in Northern Ireland represents around 1/3 of the private sector workforce, and more than 60% of the largest employers in Northern Ireland. It is the leading business organisation influencing the policies of the Northern Ireland Executive and Assembly.

Rain Newton-Smith, CBI Director, Economics

Rain was most recently head of Emerging Markets at Oxford Economics where she managed a large team of economists and was the lead expert on China.
She provided macroeconomic forecasts and analysis on China's role in the global economy and the development of Asia, helping a range of companies and international financial institutions to expand into new markets and grow their business. Prior to that, Rain worked in monetary policy and international forecast to the MPC at the Bank of England where she led a team with responsibility for developing a risk assessment framework for the UK financial system.  While at the Bank, she also went on secondment to the International Monetary Fund in Washington D.C. where she was adviser to the UK executive director. In 2010, Rain was selected as one of Management Today’s 35 Women Under 35. Rain was honoured by the World Economic Forum in 2012 as a Young Global Leader.

Alan Bridle, UK Economist and Market Analyst, Bank of Ireland UK Plc

  • assumed current responsibilities upon the incorporation of Bank of  Ireland’s UK subsidiary in 2010, which includes most of the bank’s retail & business banking activities in northern Ireland, the joint venture with the post office and the bank’s mortgage business in the UK.
  • graduated from Queens University in 1986, winning the A Smith prize, joined the Investment Bank of Ireland in Belfast and held a number of positions in the Bank of Ireland’s treasury, corporate & business and strategic marketing divisions
  • he is responsible for all the bank’s economic and market research, briefings and presentations in northern Ireland and for 12 years was co-author of the Quarterly House Price Index in partnership with the University of Ulster and the NI Housing Executive
  • appeared regularly on the business slot on BBC radio’s Good Morning Ulster, had monthly columns in both Ulster Business and Irish news business insight for more than a decade.
  • is a member of CBI NI’s economic affairs committee and has represented CBI on the northern Ireland statistics advisory committee.
  • has served on the independent panel of experts appointed by the DSD Minister to advise on affordable housing and currently is on the Steering Committee of the NI Science Park Knowledge Economy Index.

Media Enquiries

Anthea Savage, Communications & Events Executive, CBI Northern Ireland. DL: 028 9010 1117; M: 07772491506; E: anthea.savage@cbi.org.uk;

www.cbi.org.uk/ni
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