Ulster warned not to expect economic miracle
Wednesday 18 January 1995
The peace process would not automatically bring faster economic growth or a sharp drop in unemployment, said Stephen Kingon, of the accountants Coopers & Lybrand, launching the firm's annual review of the Northern Ireland economy.
But the next 12 months offered a unique opportunity, Mr Kingon told business leaders yesterday. "With international media attention focusing on the problems of the province, we must build a foundation for future inward investment and economic development," he said.
A concern highlighted in the review is that the Treasury may take its own "peace dividend" by reducing expenditure in Ulster.
Last November the Government committed itself to reallocating £180m of security cash to social and economic funding over the next three years, the move coming at a time when public expenditure was due to fall in real terms by £110m in that period.
Any reduction beyond that could have a detrimental effect on the local economy, Mr Kingon said. "The potential major benefits of peace - tourism, inward investment and improved economic activity - all need time and a considerable financial investment.
"If either ingredient is missing or significantly reduced, the province's economic peace dividend may be much less than we deserve."
The report said the ceasefires had boosted tourism. Inquiries to the Northern Ireland Tourist Board in November were up 150 per cent on the previous year and hotel occupancy was at its highest level since records began in 1973. Tourism currently employedabout 10,000 people and it had been suggested there was potential for another 10,000 in the medium term.
The report said of the present 16,600 Royal Ulster Constabulary staff: "Many of these jobs are likely to be vulnerable as a result of the peace process and any eventual political settlement."
Business confidence had not been greatly influenced by the ceasefires. It had already been high, with 70 per cent of employers committed to further growth this year and most of the rest predicting expansion over the next three years. But there was an over-dependence on the home market and a worrying lack of export interest.
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