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Neil Gibson, chief economist at EY Ireland, said that while it would be unwise to rule anything out as regards Brexit, the likelihood of a cliff-edge departure is fading. Neil Gibson said the the hard work starts now with the start of the second phase of negotiations and he predicts some "tough days" ahead. He said that hopefully the movement to the next stage of negotiations means that we will see 2018 really focus on working towards a free trade agreement, which would be in the interests of both economies on the island of Ireland.
The EY Economic Eye looks at retail between the two economies and it revealed a significant flow in cross border retail, fuelled mainly by the shift in the exchange rate. Over €400m is expected in cross border retail sales and while not quite the peak levels seen in 2008 and 2009, Mr Gibson said that that would have led to a lot of column inches in previous years but because the Irish economy is growing so stronger, that level of 'leakage' can be afforded. The Northern Ireland economy is struggling a little bit and so the extra trade from the Republic is a timely boost for Northern retailers, he added.
Mr Gibson said the two economies on each side of the border are on very different trajectories - the economy in the Republic of Ireland is growing very strongly as consumers spend, the Government is spending a little and businesses are spending. All three legs of the Irish economic stool are solid, he stated. But compare that to the North were people are seeing real pay cuts due to rising inflation, no executive government in Stormont and nervous businesses.
But jobs growth on both sides of the border is still predicted, which Mr Gibson said is encouraging. He said that while the level of jobs growth in the Republic is hugely impressive, it does lead to the spectre of talent shortages. He said EY's clients are seeing a real battle to get their hands on the talent needed to grow their businesses.
MORNING BRIEFS - Construction activity increased sharply in November according to the latest Ulster Bank PMI survey, which monitors the sector. The construction sector has now shown growth for 51 months in a row. November saw a spike in housing activity and housing was the best performing sub-sector.
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*** Sales of bottles of Irish cream liqueur, including market leader Bailey's, are set to pass the 100 million mark for the first time. The Irish Spirits Association says sales will be up from 90 million last year to just over 100 million. The ISA credits new flavours and innovation by producers. Sales of cream liqueur here fell by 11% between 2012 and 2016.