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For Northern Ireland, which is promoting itself to US investors this week, the timing could hardly have been more opportune.
Almac, the US-owned pharmaceutical company headquartered in the region, announced last Thursday it was creating 550 new jobs as part of an expansion plan. On the same day, hydrogen bus manufacturer Wrightbus, one of Northern Ireland’s biggest homegrown successes, unveiled a large German order.
Taken together, these developments send a clear message to more than 50 executives on a trade mission this week with Joe Kennedy III, the US special economic envoy: Northern Ireland, marking 25 years of peace this year, has something to offer companies — growth potential, workers and unique dual access to both the EU and the UK.
But business leaders say the UK region has two problems: over-reliance on tech investment and under-confidence on the bigger story it can sell. This may be partly because of what Steve Orr, chief of technology hub Catalyst, calls Northern Ireland’s characteristic “lack of bullshit”.
The US is the region’s biggest source of foreign direct investment, supplying 45 per cent of projects in the past two decades. A third of all FDI investment, and 51 per cent of the jobs created, have come from the US, according to data from FDI Intelligence.
But more than a quarter of US investment and half the resulting employment have been in the software and IT sector — leading to what Máirtín Ó Muilleoir, a former NI finance minister and co-founder of a new North Ireland Growth Fund, calls “saturation” in tech jobs.
Mark O’Connell, executive chair of trade consultancy OCO Global, says the region needs to pivot more to areas such as logistics and manufacturing. Tech will in any case not benefit directly from a post-Brexit trade deal that allows Northern Ireland to trade into the EU as well as the UK because it only covers goods.
Travelling with Kennedy are Thomas DiNapoli, comptroller of the State of New York who has committed $56mn of public pension funds to investments in Northern Ireland since the 1998 Good Friday Agreement. Also on the trip are the president of Coca-Cola as well as senior energy, finance, medical and scientific investors.
For Niall Olden, managing partner at Kernel Capital, which runs the Bank of Ireland Kernel Capital Growth Funds (NI), the “big gap is private sector institutional money” in the region.
Like the Republic of Ireland, Northern Ireland already has an enviable “in” with the US — on display every St Patrick’s Day when politicians and business leaders decamp to Washington. Highlighting how politically invested the US is in the region, President Joe Biden visited Belfast this year to celebrate the 25th anniversary of its peace deal.
But it must broaden its appeal. Northern Ireland has a heritage of manufacturing, with once mighty linen, rope and tobacco industries. They are dead, but its storied shipbuilder Harland & Wolff is being revived. Tina McKenzie, who runs the region’s biggest recruitment agency, Staffline, says US investors should snap up land and warehouse space.
Besides tech and professional services, the region boasts cyber security and life sciences industries, aerospace and defence, and a thriving film sector, born from its success as a location for Game of Thrones. It also makes 40 per cent of the world’s crushing and screening machines, used in mining, construction and recycling.
What is not in place, however, is a government. A 20-month-old political crisis that erupted over post-Brexit trading arrangements has yet to be resolved. Businesses take a sanguine view, given the stop-start nature of local politics and the fact that the new Windsor framework deal made a smooth start this month. But O’Connell said a restored executive would “put the turbo” into reaping investment opportunities.
The cost of living is cheaper than in Britain and the republic and outperformed the UK overall in economic growth in the year to June 30, despite a decrease in second-quarter output. Besides offering cost advantages it has good schools and universities plus a potential pool of untapped talent: the region has the UK’s highest economic inactivity — people neither working, nor seeking jobs.
Of course, Northern Ireland has heard investment hype before. But Orr at Catalyst argues that it must now push its chest out and “develop a bit of a swagger”.
jude.webber@ft.com
