|
|
|
Issue No.8 Spring 2002
We Can Succeed
By Dr Esmond Birnie MLA
A pessimist looks at the bottle as
half empty and an optimist sees it as half full. The article by Laura Duffy
suggests she is definitely a pessimist. She presents a long catalogue of sectors
in difficulties as well as some of the structural vulnerabilities of the local
economy. She describes the impact of 11th September and Foot and Mouth. It is
hard to say she is wrong in her details but she has left out the considerable
amount of good news.
During the last decade or so the Northern Ireland economy substantially
outperformed the UK average in many regards. Manufacturing output, GDP and
employment growth rates were all substantially higher than the rest of the UK.
Whilst there are still substantial localities of high unemployment within the
Province there are also many parts of Northern Ireland where the problem has
become one of labour shortages. Our average unemployment rate is now lower than
that of three major mainland regions.
Yes, it is true that public spending remains proportionally much higher here
than in the rest of the country. However, part at least of Northern Ireland's
relatively rapid economic growth in the 1990's can be attributed to the private
sector. For example, we now know that exports were booming throughout the 1990's
and this was achieved notwithstanding the appreciation of the pound sterling in
the later years. Trade growth was particularly marked with the Republic of
Ireland and the rest of the world outside of the European Union.
Laura Duffy concluded by arguing we needed a vision and we needed to face
reality. I agree. We need to move on from assuming that the world economy owes
Northern Ireland a living or that we can rely on any particular further
generosity from the chancellor of the Exchequer Gordon Brown when he decides how
many additional funds to devote to the Province. In the future we should rely
not on low wages for competitive advantage but a high and rising level of
productivity.
Devolution is no panacea but it is a good start. We are now moving towards a
more co-ordinated and attentive style of development policy. One which will, for
example, rightly place a priority on achieving a more innovative society with
much larger research and development efforts.
Since your cover posed the question "How strong is the Union?" with
respect to the Northern Ireland economy let me close by reiterating the economic
case for the United Kingdom. The UK is a unique multinational state. It has for
several centuries combined unity and diversity. In economic terms it has been a
well functioning economic and monetary union for years.
The recent "Celtic Tiger" performance south of the Border has been
impressive but much of this represents a once and for all catch up. Whilst
Northern Ireland firms should certainly reap what gains they can it is doubtful
if it would be at all wise to switch from an economic unit of 59 million to one
of only 5 million. There are also very strong grounds for believing that we are
better off staying in the sterling area as opposed to the Euroland. Since the
early 1990's we have had our most rapid export growth to the non-Euro countries
in the world economy.
|