New money 'can herald a sea change in the Northern Ireland's economic position'
BUSINESSES have welcomed Theresa May's pledge of £1 billion in additional funding for Northern Ireland as part of an agreement with the DUP to prop up her minority government.
The deal reaffirms Stormont's previous commitment to a new lower rate of corporation tax for the region, and sits alongside significant investment in the north's physical infrastructure and broadband capacity.
And the extra cash offers up a package of measures which can herald a sea change in the north's economic position.
Mervyn McCall of Grow NI, the umbrella group which represents business organisations employing 200,000 people in Northern Ireland, said the devolution of corporation tax-varying powers and the setting of a new lower business tax rate is one key economic policy all of the political parties have agreed will create a vital catalyst to economic grow.
He said: “The new global rules around taxation will encourage business to generate profits in places where real economic activity will take place and will discourage the use of low tax countries where little or no activity happens.
"This will mean that a low tax jurisdiction that can offer a well-educated work force, good infrastructure and a sensible cost base will be very attractive to global businesses who want to locate in either the UK or close to the EU. Implementing a 12.5 per cent corporation tax rate will be a massive statement of positive intent for our future economic growth.”
The deal ensures that we will see the delivery of the long-awaited York Street Interchange as well as the A5, A6 and other key infrastructure projects can at least get to starting line.
Agri-food firms were heartened by the explicit reference within the document recognising the importance of the sector to the economy and further confirmation that agriculture will be a critical policy area for the UK Government during the EU exit negotiations.
Extending ultra-fast broadband infrastructure has also been identified as a key priority, which has the potential to significantly boost the productivity and fortunes of local businesses, while the generous package could also see Belfast achieve its long-coveted 'City Deal' status and lead to the creation of more Enterprise Zones.
The commitment to review air passenger duty (APD) is being seen by the local airports as a ‘step in the right direction', and they have pledged to be "vigorous and tireless" in their efforts to scrap what they see as an "objectionable" tax.
Belfast International Airport managing director Graham Keddie said: “There is little doubt that APD is handing a significant and unnecessary advantage to the Republic of Ireland, and the sooner that situation is corrected, the better.”