Posted on Wednesday 8 January 2014 by Ulster Business

LIB Paul Terrington

Paul Terrington, Chairman of the Institute of Directors in Northern Ireland, outlines the organisation's priorities for 2014 and the measures it believes will help the economy to recover.

Economic indicators are improving, so do you expect 2014 to be a better year for your members than 2013?

There are two separate issues here. First there is now evidence of real recovery, so we expect the Northern Ireland economy to grow by around 1.6% in 2014 and unemployment to fall to around 58,000.

The second issue is if the members agree; and they do. Our most recent membership survey shows that 74% of respondents expect business to improve in the next 12 months with only 3% expecting a decline.

And when it comes to exporting – which will be the real driver of recovery - nearly half (46%) of our respondents are currently exporting and 70% of those expect volumes to increase, with around 65% are planning to both recruit more and invest more. So, yes, we have good grounds to be modestly optimistic.

What one thing would most help our businesses to thrive and achieve success?

There is no one silver bullet. But every single report since the 1950s – and there have been nearly 20 of them – says there is a direct link between R&D and exports and increased productivity and profitable and sustainable job creation.

So a big push on R&D and innovation and exports. Programmes like the Small Business Research Initiative are helping by encouraging businesses to innovate alongside potential public sector customers while retaining IP that can then be exploited beyond the public sector and into export markets.

Tax breaks like the Patent Box, R&D tax credits and recent cuts in corporation tax all stimulate and reward investment, but there is still too much bureaucracy facing business. So, we need to work to exploit a number of complementary opportunities.

What are the greatest challenge facing businesses in Northern Ireland?

Get out and sell – sell products, sell services and sell Northern Ireland as an investment location. We don't have enough exporters, with enough great products and services to drive economic recovery. We can sell big, expensive and bulky items like buses, aircraft components and quarry equipment halfway around the world, so if we can do that we can sell anything.

That's why we need to encourage more companies get into exporting.

Is there any one economic issue that you think will dominate the headlines this year?

Scottish independence is the big one and the implications are underestimated. A 'Yes' vote means more than just an independent Scotland from 24 March 2016; it means a likely reform of the Barnett Formula, a probable increase in localism amongst the English regions. A 'No' vote will probably take the Scottish government back to the negotiating table for further fiscal devolution.

Whatever the outcome, the changes will have widespread implications or the rest of the UK and particularly for Northern Ireland, where a decision on corporation tax has already been deferred to post the September 2014 referendum date.

What are the top three issues your organisation will be focusing on in 2014?

IoD is a personal membership organisation rather than a representative or employer's body and we believe that better leaders create better companies and the best leaders are world-class. So, facilitating, encouraging and training our members towards leadership excellence is our number one priority.

We'll be utilising the Institute's resources, programmes and events to help grow our membership in the public, private and third sectors to further increase knowledge and skills around good governance and leadership. Expanding our membership, influencing passion for leadership beyond the private sector is a second priority.

After that, we have a number of issues that are of equal importance...planning is a major issue in Northern Ireland priority and we need to get it right, particularly as more powers move to local government. Skills, employability and aligning tomorrow's workforce skills with today's education and training systems, is another, while issues around public appointments and economic policy are all important to members.


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