Slides 1-10 Michael Gallagher Derry City and Strabane District Council Slides 11-25 Loretta McNicholas Donegal County Council Slides 26-38 Michael Gallagher Derry City and Strabane District Council Slides 39-56 Prof. Frances Ruane Trinity College Dublin Queen’s University Belfast Slides 57-69 Dr. Katy Hayward Slides 70-95 Dr. Eoin Magennis Ulster University 1
Driving Growth in the North West with the Challenges and Opportunities of Brexit Michael Gallagher Strategy Manager, Derry City & Strabane District Council Tuesday, 6 th December, 2016 An Grianán Hotel 2
EU Exit DCSDC & DCC Scoping Study Challenges and Opportunities Update on Progress 3
Rationale for the Study Why? NW Region is unique in nature – its complex and interconnected relationship requires specific analysis in the emergent context of Britain’s decision to exit the EU 4
What? • To take a first look at the key issues that need consideration within this region • To devise an appropriate response that mitigates the impact while maximising the opportunity for growth 5
Purpose • To assist local authorities to develop an informed strategy in this new context which is capable of modification and adaptation as time goes on • To provide ongoing guidance to local government within the region enabling them to input into the policy making process at local and national level based on an objective robust evidence base in consultation with stakeholders 6
Strengths • Existing collaborative relationship between Councils provides us with strong foundation to tackle the challenge and maximise growth opportunities 7
Scoping Study Team – Stage 1 Economic and Research Unit DCC Statistical Support Team DCSDC Ulster University Queen’s University Economic Policy Belfast – Social Science Centre Trinity College Dublin – Department of Economics 8
Work to Date DCSDC and DCC have assembled a strong in-house team including specialist researchers and statisticians to support external expert group comprising economists and social scientists to provide ‘early view’ of Brexit impact 9
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Driving Growth in the North West with the Challenges and Opportunities of Brexit Loretta Mc Nicholas Research and Policy Manager, Donegal County Council Tuesday, 6 th December, 2016 An Grianán Hotel 11
Land boundary = 109.6 km ( 68 miles) Key Demogra ographics hics 12
Key Demographics • Total Population 308,228 + 5.3% • Total Land Area 6,110 Km 2 • Significant Critical Mass 400,000 • Population under 30 years 128,148 or 42% Complementary Regions • Derry / Strabane LGD 71% Urban | 29% Rural • Donegal LA 27% Urban | 73% Rural 13
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Access cess Educa ucational ional Services rvices 15
Implications for Free Movement of People: • Work • Education • Health Care • Retail 16
Physical and Virtual Boundaries 17
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Fisheri heries es Zones s 19
Agricul iculture ture Donegal Derry /Strabane Agricultural Area 3307.7 sq km 948 sq km Agricultural Labour 15,503 3,341 No of Farms 9,240 1,735 Hectares Standard Labour Unit Very Small 2,444 ( < 10 HA) 1,271 ( less than 1) Small 2,373 ( 10-20HA) 2,51 ( 1<2) Medium 3,241 (20 – 50 HA) 82 ( 2<3) Large 1,182 (>50 HA) 131 ( 5 or more) 20
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Overseas Tourism Donegal 2015 8% Britain 29% 19% Mainland Europe North America 44% Other Areas Overseas Revenue Donegal 2015 Britain 6% Mainland 39% 26% Europe North America Other Areas 29%
Key Demographics Origin of Overnight Trips to DCSDC 2013 - 2015 10% 7% Northern Ireland 38% Great Britain 9% Other European North America Other 37% • 375,000 RoI residents took an overnight trip in NI in the twelve months to June 2016. • These accounted for 970,000 nights and £56.9 m NISRA, Tourism Statistics.
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Strategic Model for Regional Development & Growth • New Working Arrangements • North West Strategic Growth Partnership • North West Region Development Group • North West Data & GIS Strategy 26
Stakeholder Consultation North and South - Agriculture/Fishing/Aquaculture - Construction - Manufacturing - Retail - Traded Services - Tourism/Culture/Accommodation - Banking - Logistics 27
- Retail - Exchange rate volatility has made business planning extremely difficult investment decisions are on hold – zero sum game within North West - Any return to border controls/tariffs detrimental to sector 28
- Tourism/Culture/Accommodation - While there have been increased rates of growth both North and South – high dependence on home markets results in extreme sensitivity - Any perception that Donegal is difficult to access through NI needs to be eliminated - Restrictions on labour mobility would impact in NI but visa requirements benefit increase in GB visitors to NI 29
- Agriculture/Fishing/Aquaculture NI - Loss of access to markets within EU - Possible high tariffs on some products - Loss of EU support payments post 2020 - Access to seasonal labour - Competition from extra-EU countries in UK market - Product surplus – dairy - Fishing industry may benefit significantly 30
- Agriculture/Fishing/Aquaculture RoI - Loss of access to markets within UK - Possible high tariffs on some products - Competition from extra-EU countries in UK market - Product surplus – beef - Lack of input for milk processing - Trans-national barriers – Donegal/NI/Dublin - Fishing industry may face significant challenges 31
- Education/Training - Ability to access R+D funding/partners - Replacement of existing EU funding post 2020 - Existing staff mobility – cross border workers - Student mobility – recognition of qualifications – student loans NI - Access to Erasmus by NI students - Replacement of EU ESF with UK funding stream 32
- Health - Existing initiatives in health constrained – little further collaboration? Cath Lab (PPCI), CAWT - C-TRIC – funding – recruitment of partners - Existing staff mobility – cross border workers - Access to locum staff/recruitment of nurses NI - Access to health services by cross-border workers 33
- Manufacturing - Lack of detail on Corporation Tax – NI - Divergence in standards over time - Staff mobility non- EU staff MNC Dublin/Donegal traversing NI – visa requirement - Tariffs/Bureaucracy/eForms - Cross-border trade zone - Special status NI/RoI - Common Trade Area - Relaxation of procurement 34
- Traded Services/Business - Legal requirement to have presence on both sides of frontier EU/Non – EU - Market diversification - Connectivity – broadband - Accelerated capital allowances - Cross-border enterprise zone - Joint marketing strategy – retail, tourism, business - Offer space to London based Financial Services 35
- Construction NI - EU Funding - risk - Access to single market critical - Joint ventures – EU less likely - Skills shortage – labour - Reduction in EU regulation (smaller firms especially) - Relaxation of procurement 36
Scoping Study Outcomes To provide DCSDC/DCC and other key stakeholders with robust evidence base comprising - Baseline socio-economic report on region - Outline of macro-economic environment – NW’s experience to date - Examine the changing relationships and potential cross border models - Economic quantification of forecast alternative scenarios - Sectoral analysis and exploration of stakeholder consultation feedback 37
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BREXIT in the North West: Challenges and Opportunities Professor Frances Ruane Trinity College, Dublin Economic and Social Research Institute, Dublin 39
BREXIT IN CONTEXT GLOBALISATION 40
BREXIT IN CONTEXT GLOBALISATION EUROPEANISATION ROW 41
BREXIT IN CONTEXT GLOBALISATION EUROPEANISATION ROW REGIONALISATION UK and ROI 42
BREXIT IN CONTEXT GLOBALISATION EUROPEANISATION ROW REGIONALISATION UK and ROI NW 43
ECONOMIC POLICY IN CONTEXT • Macro events dominate public discourse • Macro policy is typically ‘whole country’ BUT • Macro events have regional consequences – Regions differ by income and social structure – Regions differ by economic activity – Regions differ by potential opportunity sets • Impact of Brexit will not be uniform across UK or Irish regions – what of the NW? 44
SPECIFIC CHALLENGES/OPPORTUNITIES The likely range of possible Brexit options – UK with WTO relations with EU (hard) – UK with EEA-type relations with EU (soft) Look at four issues 1. Uncertainty – only challenges! 2. Impact on trade – on and off the island 3. Impact on investment – local and foreign 4. Impact on Human Mobility 45
1.1 Uncertainty • Uncertainty – always present but scale exceptional • Issue of measuring impact of Brexit on UK • Current (SR) Uncertainty impacts on – exchange rates – volatility burden – overall impact depends on composition of exports/imports – border trade acutely – consumers can arbitrage in response to changes => business challenges – growth projections – feed into business expectations • £ reduction: NI exporters to EU more competitive; ROI exporters to UK less competitive • Stronger immediate impact for business in ROI? 46
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