Foreign investment declining at a faster rate in Northern Ireland than anywhere else in UK ‘surprising’ and ‘worrying’

13 Jun 2016 | News

Northern Ireland
Belfast Telegraph

A damning report showing that the level of foreign investment in Northern Ireland is declining faster than anywhere else in the UK has been branded “surprising” and “worrying”. Northern Ireland had 15 foreign direct investment (FDI) projects in 2015, fewer than half of the 39 it secured a year earlier, according to EY. The latest figures come despite claims from Invest NI that outside London, Northern Ireland is the “leading UK region for attracting inward investment”. Scotland saw a 50% increase to 119 projects, while Wales had 41 FDI projects, down one. Northern Ireland’s drop contrasts with a surge in overall activity across the UK. Like the rest of the UK, Northern Ireland has had to deal with EU changes to regional aid. From July 2014, new rules were introduced  that meant companies  here with more than 250 staff could miss out on funding for expansion projects that involved the same activity undertaken at the same premises. Economist John Simpson said the report was both “surprising and worrying”. SDLP leader Colum Eastwood added there would “rightly be concerns” about the poor figures and added that an “economic strategy based on travelling the globe promising tax breaks for big businesses… was never a sustainable, or desirable plan”. Northern Ireland’s politicians have to take some of the blame, according to Andrew Webb of Webb Advisory. He said: “I think our politicians have to take their share of responsibility. The past 18 months have been politically chaotic. “Investors thrive on stability. That is the one thing we haven’t been able to deliver.” Mark O’Connell, chief executive of economic development firm OCO Global, added: “Clearly, there was a bit of a fire sale going on last year as the EU rules changed and projects taken over the line might have naturally fallen in to this (the 2015 figures). Nevertheless, it’s not the quantity, it’s the quality.” He also claimed the “whole skittishness about Brexit had not helped” investor confidence and added: “There are a lot of stalled decisions.” A number of large law firms have expanded in Northern Ireland over the past few years, including Allen & Overy and Baker & McKenzie. Some of the latest investments include HighWire Press, which is spending £6m to set up a high-tech centre in Belfast. Invest NI said during the financial year it “secured 35 inward investment projects”, but it also counts investments from firms within the UK. The agency said some of the latest projects included UK direct marketing firm Intelling, which is aiming to create 250 jobs. It added: “This report therefore does not reflect the full picture of FDI success in Northern Ireland last year”.