June 17 (Reuters) – This time 10 years ago, few would have predicted that Northern Ireland would be topping the United Kingdom’s economic growth charts after the 2016 vote to leave the European Union.
Its relative success is not a straightforward story about Brexit, however.
Marie Doyle, partner with accountants Deloitte in Belfast, said the vote had caused enormous uncertainty across businesses there, as it did elsewhere in Britain.
But in Northern Ireland’s case, it was against a backdrop of rapid progress already underway.
“We are, and have been, a post-conflict society. We have been on a quietly upward economic trajectory really since pre-Brexit – maybe the late noughties, the early teens, when we were starting to see some significant investment into Belfast,” Doyle said.
Below are some of the indicators that underline the Northern Irish economy’s strong performance.
ECONOMIC GROWTH
Northern Ireland’s economy grew by 16.5% from 2015 to 2023, outpacing every other major region of the UK. The same dataset shows the UK economy expanded by 11% over the same time frame, with Scotland’s economy ranking last with growth of 7%.
SERVICES BOOM
As in the rest of the UK, the services sector is dominant in Northern Ireland’s economy, but there have been key differences in its performance.
In contrast to a 24% drop in financial services output for the UK as a whole between 2015 and 2023, in Northern Ireland it has increased by 50% — in part a reflection of its proximity to Dublin, one of the European Union’s financial centres that has benefitted from the UK’s exit from the EU single market.
Retail has also thrived, whereas in the rest of the UK sales volumes remain below their pre-pandemic levels. Analysts say the permanent depreciation of sterling has helped tempt consumers in the Irish Republic to make frequent shopping trips to the North.
INTEGRATION WITH IRELAND’S ECONOMY
Northern Ireland’s economy is integrating increasingly with the south, in part thanks to a burgeoning economic corridor between Dublin and Belfast — the latter finding favour with international firms because of its low labour costs, cheaper property and a skilled workforce.
Whereas Ireland’s share of goods and services in the Northern Irish economy – excluding the financial sector – stood at only 14% in 2015, that rose to 26% in 2024, according to data from the NI Statistics Agency.
The rest of the UK’s share of Northern Irish trade fell to 51% from 59% over the same time frame.
Doyle said Deloitte had this year observed a surge in cross-border merger and acquisition deals.
“It’s more than a supply chain, it’s an integrated business model on the island that is really taking off,” she said.
The Windsor Agreement agreed in 2023 — which allows Northern Ireland to simultaneously access the EU single market for goods and the UK internal market — also represents a plus for the province’s manufacturing sector, Doyle said.
Reporting by Andy Bruce Editing by Gareth Jones.
