THREATENED trade sanctions by the UK against Russia could have a major impact on Northern Ireland exports, a leading economist claimed yesterday.
Companies in the north exported around £80 million worth of goods last year to Russia, which over the last 10 years has been emerging as one of the world's key growth economies alongside Brazil, India and China.
But in the wake of the MH17 downing and ongoing crisis in Ukraine, many western economies are considering a range of hard-hitting economic sanctions designed to force Russian president Vladimir Putin into changing his strategy.
The UK has already indicated it is prepared to take an economic hit as it pushes for sectoral sanctions on wider sectors of the Russian economy, which could cover areas such as financial services, trade and defence cooperation and energy exports.
PwC's Northern Ireland chief economist Dr Esmond Birnie, pictured, says this evolving situation represents "a major downside risk" to the local economy.
He said: "What we're experiencing here at the moment is a normal and predictable upswing in the economic cycle, but there's no cause for euphoria because Northern Ireland has still a long way to go to keep pace with growth in other parts of the UK.
"But there are downside risks, many of which are external and beyond our control.
"Aside from weaknesses in external markets like the eurozone, US and China, there may also be a negative impact on UK growth through instability in the Middle East or the effects of trade sanctions on Russia."
The UK's overall economy grew by 0.8 per cent in second quarter of 2014, according to data from the Office for National Statistics.
That puts it 0.2 per cent ahead of its pre-crisis peak in the first quarter of 2008, with the economy growing by 3.1 per cent overall in the year to June.
PwC says its expects the Northern Ireland economy to grow at 2.2 per cent this year - the lowest rise in the 12 UK regions.