BUSINESSES in the north remain more optimistic that a hard border can be avoided, a new report out today has revealed.
The latest AIB Brexit Sentiment Index for July to September 2019, which surveys small and medium enterprises (SMEs) on both sides of the border, found 32 per cent in the north expect a hard border, compared with 59 per cent of firms in the south.
Two-in-three (66 per cent) of SMEs surveyed north of the border revealed that they had either cancelled or postponed expansion or investment plans between July and September, primarily due to Brexit.
More than 700 SMEs took part in the all-island survey.
Almost half of Northern Irish firms (47 per cent) said their business has already felt the negative impact of the UK’s decision to leave the EU.
Overall AIB’s quarterly Brexit Sentiment Index reached an all-time low for Northern Ireland SMEs.
Two-in-three northern firms said they now have a negative outlook on the future of their business compared with 71 per cent in the Republic.
Some 70 per cent of northern businesses are anticipating a negative impact on the wider economy, compared with 86 per-cent in the south.
Just six per cent of Northern Ireland SMEs said they had a formal Brexit plan in place. Just over half (53 per cent) haven’t started planning yet, while almost half have said they are not confident that they understand what a potential ‘no-deal’ Brexit would mean for their business.
Brian Gillan, who heads the bank’s business and corporate division in the north, said results of the survey were not surprising given the political stalemate throughout the third quarter.
“Sentiment is down across all sectors but worryingly it is at an all-time low in the manufacturing and tourism sectors, both very important for the NI economy.
“The continued uncertainty is also severely hampering investment planning with 66 per cent of NI business this wave advising that their investment plans have been cancelled or postponed. In tandem a higher proportion of NI SMEs are postponing bank borrowing for capital investment due to Brexit – up to 19 per cent.
“While we understand the reluctance of businesses to plan, given the levels of uncertainty we believe there is still value in considering the potential impacts of Brexit on your business – especially in a ‘no-deal’ scenario.
“Our advice to NI businesses is to continue to work with their advisers and trade and industry groups to make sure they are as best prepared for all eventualities.”
