Northern Ireland businesses favour the euro

Almost two-thirds of Northern Ireland businesses would vote to join the euro if a referendum were held today, according to a poll conducted by business advisors, PricewaterhouseCoopers (PwC) as part of its annual survey of business attitudes.

PwC asked a representative sample of local firms how they would vote if a referendum on the Euro were held today.

Over 63 per cent of all respondents would vote in favour, 24 per cent against, with 13 per cent remaining undecided.

In his Budget speech, the Chancellor said he would make an announcement before the summer confirming whether or not the UK economy would benefit from membership.

The PwC poll comes as speculation grows that the Government will now postpone a referendum on joining the Euro until after the next election.

PwC chief economist Philip McDonagh said the particular circumstances of Northern Ireland accounted for the high percentage favouring membership of the Euro: “Slow economic recovery and low-cost competition is hurting local exporters. Despite the strengthening Euro, exporters to Ireland and other parts of the Eurozone perceive currency volatility as yet another barrier to trade. In border areas and amongst retailers, where dual currency has become a way of life, the euro is already accepted.

“As customers in the Republic and the EU align their supply chains to the euro, local suppliers and exporters are feeling isolated. This is not a surprising result.”

The construction industry was most supportive of early entry, with 67 per cent in favour, followed by manufacturing and the service sector.

Bigger firms were most enthusiastic, with 69 per cent of companies employing more than 100 people favouring membership. With the exception of RoI-owned companies, over 70 per cent of foreign-owned firms would vote to join. Half of Irish-owned companies were against membership.

Even a majority of the smallest companies - those employing fewer than 10 people - perceived the Euro as beneficial, with 57 per cent claiming they would vote ‘yes’ in a referendum.

The detailed results will form part of a special report on EU enlargement in PwC’s 2003 ‘Northern Ireland Economic Review and Prospects,’ to be published next month.

Northern Ireland business’ apparent liking for the Euro is nothing new. In the survey for the 2002 ‘Economic Review’ nearly 70 per cent of local exporters favoured Northern Ireland introducing a dual currency system, affording the euro equal legal status with sterling within Northern Ireland.

(MB)