NI economy growing but still trailing rest of UK

Dr Esmond Birnie
Dr Esmond Birnie

The latest figures concerning growth in the province are encouraging but highlight a familiar problem economist Esmond Birnie has claimed.

Dr Birnie, chief economist in Belfast for business advisors PwC, was commenting on the latest figures from the Northern Ireland Composite Economic Index which shows the economy here grew by 1.1 per cent in the first quarter of this year.

“The Index confirms a number of messages about the NI economy, the most important of which is that the economy is still growing, but considerably more slowly than the UK average.

“The Index suggests that in the 12 months to the end of March 2015, Northern Ireland’s economic growth averaged 1.6 per cent compared to three per cent for the UK.

“However, the Index suggests that growth in the first three months of 2015 was 1.1 per cent - almost four times the UK Q1 GDP growth of 0.4 per cent.

“A level of growth so much above the UK should be regarded with caution as it may have been artificially accelerated by some very rapid expansion in the construction sector.

“In summary however, as at Q1 of 2015, Northern Ireland’s aggregate output was still 8% down on its pre banking crisis peak in Q2 2007; while by comparison UK GDP is now 4.5 per cent above that level.

“That give some idea of the ground that has to be made up in this region to match the pace of recovery elsewhere in the UK.”