Posted on Tuesday 20 October 2009 byUlster Business
The Northern Ireland economy will see economic growth return in 2010 through a modest 0.5% increase in gross domestic product, First Trust's quarterly Economic Outlook & Business said.
"The NI Economy will remain fairly flat during 2009H2 with business and consumer confidence picking up slowly," it said. "On the basis of the evidence it is not unreasonable to expect a return to positive economic growth in 2010."
The report said confidence in the housing market may be recovering with prices looking to have bottomed but warned overall consumer confidence remains 'feeble' and the outlook for spending subdued, given no prospect for further fiscal monetary stimuli.
Public spending cuts following the general election look 'increasingly inevitable' while the claimant count is expected to climb to over 60,000 in the second half of 2010 compared to 51,000, or 5.9%, in July 2009. Despite this, the region remains one of the lowest unemployment regions in the UK and Europe.
One of the report's authors Mike Smith, head of the School of Economics at University of Ulster, said the government could be doing more to help the business community.
"In comparison to the local Scottish administration's response to the global economic crisis, Northern Ireland's (NI) policymakers have been much less proactive. While in Scotland the Executive produced a National Recovery Plan in August 2008, which has since been revised as national and international economic conditions have altered, local policymakers have been less proactive by comparison.
"The Programme for Government (PfG) and Budget remain largely unchanged since their publication in January 2008 with only some limited responses from individual departments. In the context of increased pressures on the NI Executive's Budget at this time, with future public sector funding pressures still pending, it would seem prudent for the NI Executive to finally start the ball rolling by initiating a review of the PfG and Budget."