Mr. Fergal O'Brien:

I thank the Chair and members for this opportunity to meet with the committee again. We were here earlier this year and it is very good to see the committee continue to work on this very important matter.

Our previous presentation very much focused on IBEC’s campaign, For Peace + Prosperity. That was a campaign we delivered over the first half of this year to recognise the 25th anniversary of the Belfast or Good Friday Agreement. I am delighted to report that it was one of the most successful campaigns IBEC has run. The feedback from our members and stakeholders, both domestically and internationally, has been exceptionally positive and really supportive. All of the events were well attended and we had very positive engagement throughout. The overall purpose has definitely been accomplished. That purpose was to remind the business community and other stakeholders of the importance for them of the stability and prosperity that the agreement continues to underpin right across the island. Just to let the committee know, we took the campaign off the island and held successful events in the Irish Embassies in Washington and London. There was also a very well-attended event that saw much engagement at the IBEC office in Brussels earlier in the year.

The committee has asked us here today specifically to discuss economic opportunities and enterprise in the all-island economy, IBEC’s work on its joint business council with CBI Northern Ireland and the Economic and Social Research Institute-National Institute of Economic and Social Research macroeconomic modelling project that is currently under way. I will take these issues in reverse order.

IBEC and the Economic and Social Research Institute, ESRI, are undertaking a joint research programme in collaboration with the National Institute for Economic and Social Research, NIESR, in the UK to provide additional insights on the economy of Northern Ireland, the all-island economy and links to the wider UK economy and beyond through the development of a macroeconomic model. This research programme will combine the organisations’ modelling expertise, existing research databases and proven methodologies to develop a deeper understanding of the economy of Northern Ireland and its link to Ireland and the wider UK economy, working in three interrelated strands.

The first strand aims to develop a macroeconomic model of Northern Ireland. As many members will be aware, no such model exists in the form we are used to working with here in the Irish economy or across the overall UK economy. It will look at links with the UK and the global economy and create a new analytical tool allowing for the analysis of economic linkages, policy measures and the transmission of economic shocks, both positive and negative.

In the second strand, parallel to developing the model, we are going to produce a series of papers on economic issues using the data gathered for model construction so as to present comparative analyses of the Northern Ireland and Irish economies along with all-island trade issues. Finally, workshops and conferences will be organised over the three years of the programme where the work will be presented and discussed. That engagement has already started and we have had very significant interaction on it to date, which has been very positive.

The programme is overseen by a steering committee drawn from the research area across the island and Great Britain and its outputs will enhance understanding of the prospects and choices mutually re-enforcing economic progress. At this point, the very detailed and technical work of building a macroeconomic model for Northern Ireland is well advanced and is due to be completed in 2024. Through the framework, we have also supported the ESRI's publication of a ground-breaking report on North-South trade and business post Brexit. That work was published before the summer.

On IBEC's work with the CBI in our joint business council, we are very focused on the future of energy and climate and continue to be concerned about the ongoing deficit in North-South connectivity that remains to be addressed. On energy, we note that there is an absence of joined-up North-South conversations on all-island energy futures. This is despite the very significant energy challenges we are all aware of and the fact that it is a single electricity market that keeps the island’s lights on. In addition, the climate action targets being set separately for both jurisdictions will struggle to be met without much more substantive and serious consideration of how our all-island energy future out to 2040 will help to ensure their delivery.

From its earliest work, infrastructure investment and improvement has been a major concern for the joint business council. Regrettably, the ambition we had for infrastructure improvement has not been delivered on. However, there is another opportunity now in the availability of resources from the shared island unit and, through the Irish Government, the creation of a national infrastructure fund which we believe should include ring-fenced capital funding devoted to delivering the national development plan and include projects that deliver the substantial North-South connectivity that is very much required.

In terms of the wider challenge of economic opportunities and enterprise, we note that, at our previous session with the committee, it was asked why Northern Ireland is not benefiting more from spillover effects from the current spectacular success of the Irish economy. As was stated then, this is certainly a valid question but it is equally valid to ask why more attention is not being paid to where this spillover is evidently happening in order to accelerate the momentum that has been established. For example, the Central Statistics Office and the Northern Ireland Statistics and Research Agency agree that annual goods trade alone in the all-island economy is valued at close to €10 billion. That has seen a particularly strong surge in recent years. This is not a small sum and it is benefiting both jurisdictions. We are seeing that surge in trade flows in both directions. The ESRI report highlights that the goods being moved are from both the indigenous and foreign direct investment sectors and that a significant component of local SME cross-Border business is also being done. This growth is occurring under the part of the Windsor Framework that is working and it is mutually beneficial. Looking to the future, we believe there is the opportunity to grow this all-island trade much further.

Developing the full potential of the wider all-island economy needs the support of more time and attention from policymakers. Areas such as energy and infrastructure have already been mentioned but further developing the all-island labour market, which is a particular interest of IBEC, is also a really important issue for the wider business community.

Finally, how and where the Belfast Good Friday Agreement, across all its strands, could and should support this ambitious goal of a more prosperous and dynamic all-island economy requires ongoing attention and debate.