Northern Ireland’s economy highly exposed to coronavirus

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O’Nills Sportswear has survived decades of violence in the troubles of Northern Ireland and many recessions since its inception over 100 years ago without ever laying off staff. But all of that suddenly changed when the coronavirus struck last month, forcing the company to cut 750 workers at the time of the lockout.

The group, founded in Dublin in 1918, then went on an unexpected hiatus, winning contracts to scrub the hospital for the NHS to protect front-line staff treating patients with Covid-19.

Management, which was on the verge of shutting down its plant in the northern Irish border town of Strabane, one of the sportswear maker’s main manufacturing locations, has been able to hire 150 workers.

But the fact that their 600 colleagues are stuck at home is still an issue with Kieran Kennedy, chief executive officer of O’Neills and a 41-year veteran of the company.

“Orders fell off a cliff when sports were banned,” he said, adding, “We never had to fire employees. . . It was incredible, heartbreaking. “

O’Neills is one of many companies hard hit by the foreclosure in Northern Ireland, a region of the UK with an oversized public sector that is a legacy of the violent conflict that forced private business before the peace pact. Good Friday 1998.

The pandemic posed a huge health problem to the recently restored power-sharing government, led by pro-British democratic unionists and Irish nationalists in Sinn Féin. The region’s health ministry said on Sunday that 299 people who tested positive for Covid-19 had died from the disease in Northern Ireland, which has 3,308 confirmed cases in a population of 1.88 million

But the foreclosure-triggered economic crisis has also dealt a potentially severe blow to long-term efforts to boost private employment, one of the biggest challenges in a region where the public sector accounts for 27 percent of jobs, compared to 16 , 5 percent. cent in the UK.

Richard Ramsey, chief economist at Ulster Bank in Belfast, said that Northern Ireland suffered “the longest and deepest recession” anywhere in the UK after the global financial crisis of 2008 as well as the slowest recovery.

“This time, because the economy stops as opposed to slowing down, it’s almost like a cardiac arrest for the economy. It’s going to be deeper and faster, this recession. “

Purchasing manager data compiled by Ulster Bank and IHS Markit Economics suggests that Northern Ireland has experienced the sharpest declines in activity in all parts of the UK, with coronavirus installed last month, production and orders declining at the fastest rate since the start of the monthly survey in 2002.

Signs of distress are evident in all sectors, from tourism to construction, retail, manufacturing and agriculture. The pandemic has also threatened the viability of air and sea routes between Northern Ireland and Britain. On Friday, the British government announced £ 17 million in state aid to support sea freight and promised the same for aviation.

HMS Caroline in Belfast

HMS Caroline in Belfast, which, like many attractions, has been closed © Niall Carson / PA

A survey conducted last week for the Northern Ireland Chamber of Commerce and Industry suggested that almost 80 percent of the region’s businesses were planning to make available some or all of the workers; 10% had no cash reserves; and an additional 60% had cash reserves for only three months.

“It is clear that we are in the middle of a public health emergency, but we are also in the middle of an economic emergency,” said Stephen Kelly, head of NI Manufacturing, an industry group. The region’s manufacturing sector has been “largely” closed, he added.

“We know that tens of thousands of jobs have been placed in the leave system, it’s just in Northern Ireland. And if the intention of the leave is to avoid redundancy for the time being, we fear that once the plan is exhausted. . . then we could talk about the loss of tens of thousands of jobs. “

Meanwhile, like their counterparts in the rest of the UK, farmers have urged the government to help tackle falling prices for beef, lamb and milk. The sector, heavily dependent on sales to the rest of the UK, was reduced by the collapse in demand in Britain after the foreclosure forced the closure of restaurants, hotels and pubs.

“We are now producing food at a price below the cost of production. That means it is no longer profitable, “said Victor Chestnutt, a fourth generation sheep and dairy farmer on the north coast of Co Antrim. “We are experiencing a sharp drop in prices. We were at a level that was barely sustainable at the start, so there is no play in the system to take the cups. “

Ian Carrick, a consultant who works with farmers, said that many were “really frustrated” with their diminishing yields. “They are ranked among the main workers in the food industry producing an essential product and yet their situation will be worse at the end of this process than at the beginning. It’s just not viable. “

Just a few weeks ago, Northern Ireland was still trapped in the long and bitter Brexit debate on the future of the border and trade between Britain, the Republic of Ireland and rest of the EU.

Returning to Strabane, Kennedy of O’Neills said his goal has now changed completely. “Brexit was a very, very worrying time for us. But, again, there was always uncertainty about what was going to happen. But with that [coronavirus] he turns pale in insignificance. “

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