Mr. Aidan Gough:

We are unable to appoint a CEO at present. It is probably worthwhile to run through the achievements of InterTradeIreland, how the landscape has changed over the past 20 years and touch on the impact of Brexit. InterTradeIreland was founded formally in the British-Irish Agreement Act and the Good Friday Agreement. The environment in which it was formed was well summed up in an editorial that spoke about a cold denying silence that descended across the island and resulted in a process of fracture across all spheres of public life. This was particularly acute in the business sector. Research commissioned by us a number of years ago showed that the level of cross-Border trade was significantly below what one would expect between two economies of this size sharing an island space. In fact, the trade was less than 30% of what one would expect.

Have things changed in the interim? From our point of view, InterTradeIreland has engaged, advised and guided over 39,000 companies in the last 19 years. The companies are in every county across the island. We see ourselves as an all-island body working with businesses and offering the opportunities that cross-Border trade and business development can give to small businesses across the island. We have worked directly with, and supported through our programmes, 8,000 companies. Over 1,000 of them were first time exporters and almost 1,000 were first time innovators. Exports and innovation are critical to the growth of businesses and the economy. As a result of these interventions, and they are primarily with small to micro-scale businesses rather than those with 40 or more employees, those businesses have created over €1.2 billion of additional business development value and have delivered over 14,000 jobs. The impact of the body has been considerable in the last 18 years.

At a more macro economic level, total cross-Border trade has doubled. It has been growing at an average rate of 4% per annum and currently stands at approximately €6.3 billion. The cross-Border market is disproportionately important for both Northern Ireland and Ireland. At present, Northern Ireland accounts for 10% to 12% of total exports from Ireland to the UK but Northern Ireland's population is only 2.9% of the UK's total population, so there is disproportionate reliance on the Northern Ireland export trade for Irish business. For over half of Irish exporters Northern Ireland is the destination for more than half of their exports and for 25% of Irish firms Northern Ireland is their only export market. The degree of inter-reliance is considerable.

It is a particularly important market for small businesses. For Northern Ireland, the majority of cross-Border transactions are made by micro and small businesses. Some 74% of export deliveries involve businesses with fewer than 50 employees, while 80% of micro businesses and 70% of small businesses that export from Northern Ireland sell only to the South. It is their only export market. The type of business involved in cross-Border trade is also reflected in the pattern of trade across the Border. It is relatively high frequency and of relatively low value, which again reflects the small business aspect. It also reflects a growing island economy. These are primarily small businesses that are operating in and treating the island as a local market. Approximately 208,000 vans travel across the Border every month. They are carrying relatively low value produce on board but it is indicative of a market that is a local island economy where a business rings another looking for something and the other business can say it will deliver it down the road later that day. It is a market characterised by low value but high frequency small businesses operating as a local market because there are no barriers.

From research we have carried out over the past year there is strong evidence of considerable growth and a considerable level of interconnectedness of trade through the development of cross-Border supply chains. Our research, which we commissioned from the Economic and Social Research Institute, ESRI, shows that the majority of cross-Border trade takes place in intermediate products, that is, products that are moving within supply chains. They often move back and forth across the Border numerous times before a final product is sold.

That is how the trade picture has developed. There is a much more interconnected cross-Border picture now. The same applies to research partnerships, which are also vital for the economies. InterTradeIreland convenes and shares an all-island steering group for Horizon 2020.

In 2014, the group agreed a strategic action plan, to be implemented by InterTradeIreland, with the target to draw down €175 million in North-South collaborative projects from Horizon 2020. That is a considerable uplift on the achievement regarding the previous framework programme, FP7, under which we drew down some €70 million or €75 million. So far, the evidence from the first two years of Horizon 2020 suggests that North-South applications and drawdown have been double that of the equivalent period in FP7. The total drawdown to March 2018, the date up to which we have statistics available, shows that collaborative North-South applications for Horizon 2020 are to the tune of €68.5 million, which is nearly what we achieved in the whole of the FP7 programme. Again, this shows how the connectivity of the relationships has built up and that we are starting to reap value from those initiatives. We also provide a secretariat to the US-Ireland research and development partnership programme, which is a partnership that is growing and delivering world class research. Projects that are supported through that programme are world class and there is roughly €70 million worth of world class research being done on a collaborative basis through the US-Ireland research and development partnership programme.

Cross-Border co-operation is delivering and we can see this by just measuring our own performance in terms of value added in business development figures and jobs created. We also see it in a wider perspective. In particular, it plays a valuable role in the development of an export strategy. Some 71% of exporters report that cross-Border trading was the catalyst for exporting further afield. For 71% of businesses, their first experience of exporting was into the cross-Border market on this island, which is where they gained the confidence and experience to go further afield. Recent research published by InterTradeIreland finds that cross-Border exporters have higher productivity, higher turnover and employ more people than businesses that do not export. In fact, goods firms that export across the Border are found to have a productivity boost of 9% and 93% higher turnover than firms that only sell in their local market, and they employ 46% more people. Cross-Border trading is delivering, and the evidence shows the degree of connectedness between Northern Ireland and the Republic of Ireland has grown substantially in the past 20 years. That cold, denying silence to which I referred at the beginning has been replaced by a real willingness to do business, and business that is creating real value. We envisage building on these growing relationships by scaling existing partnerships and networks into wider clusters.

In view of the fact that ours is a cross-Border trade and business development body, Brexit has been exercising our minds considerably in the past two years. InterTradeIreland bases all its interventions on evidence-based research. We have undertaken a programme of research to determine the potential impact of Brexit on the existing trade structures and to help us identify sectors and business types which are most likely to be impacted. One of the first studies we published looked at the impact of what is known as a hard Brexit - the WTO scenario. It concluded that, if nothing else changed, there would be a negative impact of 16% on cross-Border trade and it would have an impact across all sectors, but predominantly on the agrifood sector. This is now well known but I make the point that we published that report two years ago, so it was one of the first reports that provided this evidence. A further report shows that supply chains are highly integrated and the majority of goods that cross the Border do so as components within supply chains, and this happens to a much higher degree than is the case with other international trade. Therefore, protecting those cross-Border supply chains will be important.

As we know, cross-Border trade supports increased productivity, employment and firm turnover. Small businesses that trade across the Border fall into the highest risk categories and would be the most exposed to a hard Brexit basically because they do not have the capabilities and resources to deal with the extra bureaucracy, and we found they are operating at relatively low margins. While the research is much more detailed, those are the headline points. Ms Curran may wish to explain the detail further.

We have also opened a Brexit advisory service to help businesses navigate through whatever new relationship emerges from the negotiations. The first thing we did in regard to that service was to get out and speak to businesses. Our message was to tune down the noise. We were very concerned that some 98% of businesses were basically ignoring Brexit and not planning, whereas we were trying to get them to start planning for it and wanted to help them with that process. While they told us that the main reason they were not planning was uncertainty, our message was that there was planning and risk assessments they could undertake to see where they were exposed in order to be ready for whatever scenario emerges. Since then, we have held events all over the island and we continue to do so.

We have also introduced a Brexit voucher which is assisting small businesses to start the planning process and through which they can claim up to €2,000 to get expert advice to see where they are most exposed and to start taking action. There is a very high demand for that service and it is rising all the time. We have given out some 675 vouchers, divided 50-50 between North and South. While it was slow at the start, it is really starting to take off and we have a very busy team trying to meet demand.