North/South Ministerial Council:  Trade and Business Development

– in the Northern Ireland Assembly at 11:30 am on 20th November 2000.

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Photo of Reg Empey Reg Empey UUP 11:30 am, 20th November 2000

I wish to report on the third meeting of the North/South Ministerial Council, in its Trade and Business Development sectoral format, held on Friday 27 October 2000.

Following nomination by the First Minister and the Deputy First Minister, Dr Seán Farren and I attended the meeting. The Irish Government were represented by Ms Mary Harney TD, Minister for Enterprise, Trade and Employment. This report has been approved by Dr Farren and is also made on his behalf.

The Council received a verbal report from the vice-chairman of the Trade and Business Development Body, Dr Harold Ennis, on the progress made to date in establishing the body. This dealt with the relocation of the body’s offices to new permanent headquarters in Newry, arrangements for appointing permanent staff and its future activities.

Mr Liam Nellis, the body’s interim chief executive, provided the Council with an update of the work that the body has undertaken so far. He also confirmed the final arrangements for a series of roadshows that will take place during November at four locations.

In accordance with the agreement that established the Trade and Business Development Body, the body was asked to bring forward proposals in four areas for consideration by the North/South Ministerial Council. These relate to: first, the development of a North/South equity investment fund programme; second, the development of graduate and other placement programmes on a North/South basis; third, the carrying out of a range of testing services for industry with a view to the development of North/South testing services on a fully commercial basis by private interests; and fourth, the implementation of standards development and certificate programmes on a North/South basis. The Council had a valuable discussion on the board’s proposals on these matters.

The Council considered the recommendation of a selection panel for the appointment of a chief executive to the Trade and Business Development Body. The name of the candidate put forward by the selection panel was accepted by the Council, and a further announcement will be made in due course following acceptance of the appointment.

The Council considered an Irish Government paper on enhancing the competitiveness of the two economies on the island, North and South. The Council agreed that the Trade and Business Development Body should take this study forward in conjunction with the Department of Enterprise, Trade and Investment and the Department of Enterprise, Trade and Employment with a view to preparing a competitiveness report for the next North/ South Ministerial Council plenary session in March 2001.

The Council agreed that its next meeting in sectoral format would take place in the South in January or February 2001. The Council also agreed the text of a communiqué, which was issued after the meeting. A copy of this has been placed in the Assembly Library.

Photo of Pat Doherty Pat Doherty Sinn Féin

Will the Minister elaborate on the effectiveness of the trade body’s roadshow? Will it sustain that type of involvement with all cities throughout Ireland, or is this just a one-off launch event, after which it will move on to another phase of its work? Does it intend to continue that type of outward projection of its work in smaller cities throughout Ireland?

Photo of Reg Empey Reg Empey UUP

Four roadshow meetings have been arranged. One took place in Dublin, one in Belfast, another in Limerick, and the fourth will take place in Londonderry towards the end of the month.

The purpose is, first, to inform people in the business community of the existence of the body. Secondly, it is to try to encourage cross-border trade and the development of supply chains through awareness of what others might be doing close at hand. The rationale is very simple: if the supply chain can be shortened, there is gain to be made from reduced stockholding and the ability to resupply more rapidly.

This is not a new idea. Local authorities have done it by having "meet the buyer" events. They have tried to introduce people trading locally to one another so that they can supply one another rather than import from abroad. It is not a one-off event. This particular event has been focused on a specific issue, namely the development of supply chains and an awareness of the body, but further activities will be undertaken. For instance, in June 2000 the body held a seminar in Enniskillen, County Fermanagh, which focused on e-business, and people from America who had succeeded in trading on the Internet were invited to it. Local people were also invited, the objective being to encourage them to take up a similar type of activity.

I see that as ongoing work to implement the operating plan which the trade body presented to the North/South Ministerial Council and which was approved some months ago. I do not expect this to be a one-off event but, rather, part of the process.

Photo of Séan Neeson Séan Neeson Alliance

I thank the Minister for his statement. Will he elaborate further on the Irish Government paper on enhancing competitiveness on the island? Does it acknowledge that there is competition between the Industrial Development Agency (IDA) and the Industrial Development Board (IDB) to attract inward investment into Ireland?

Photo of Reg Empey Reg Empey UUP

Competitiveness goes beyond the IDA and the IDB. There is a range of issues. The Irish Government put forward a paper for consideration, and no conclusions have been reached on it. As I said in my statement, the body is currently examining it. The two Departments will take it forward and seek information from other Departments.

The paper looks at all sorts of things including transport issues, e-business capabilities, and broadband capabilities. This is not simply about competition between the IDA and the IDB, which, of course, is a matter for the respective Administrations. The matter will be pursued further, probably around March.

Photo of Alasdair McDonnell Alasdair McDonnell Social Democratic and Labour Party

I would like the Minister to elaborate. From a reading of this statement, it appears that we would welcome some reduction or change in the destructive competitiveness between North and South that does not enhance the competitiveness of either.

Will it be possible for the North/South trade body to develop joint marketing initiatives in the USA or elsewhere and will the North/South trade body make any effort to encourage development outside the eastern seaboard and particularly in areas north-west of the Bann and south-west of the Shannon?

Photo of Reg Empey Reg Empey UUP 11:45 am, 20th November 2000

There appears to be confusion about the purpose of the Irish Government’s paper on competitiveness. It is not concerned with inward investment because that is not a function of the trade body. It is concerned with benchmarking the two economies against economies worldwide, seeing how the economies compare with their major competitors and pinpointing their strengths and weaknesses.

The worry about the focus on the eastern seaboard is common to both economies. A few years ago, for example, there was great concern about the level of concentration on the Belfast/Dublin corridor. Many people in Northern Ireland and in the Republic of Ireland felt — and continue to feel — a sense of isolation. Members will be aware of the pressure that exists west of the Bann for activity to develop its infrastructure. People want to feel that they are on as level a playing field as possible. A similar situation exists in the Republic of Ireland with trade, business and tourism. The people of County Donegal feel a sense of isolation, and this is reflected in the comments of their elected representatives.

The paper, therefore, is not concerned with joint marketing but with benchmarking the economies of Northern Ireland and the Republic of Ireland against one another and against competition. That is the area that is being looked at, so areas such as e-commerce and broadband technology must be examined.

The Programme for Government states that broadband issues in Northern Ireland must be dealt with. That is one means of creating a level playing field for areas west of the Bann and for other more remote areas. I am conscious that in recent years the concentration has been on the east. As the work of the North/South trade body and the Programme for Government continues, I hope that greater efforts will be made to ensure that there are viable and successful economies west of the Bann.

Photo of Sammy Wilson Sammy Wilson DUP

As an avid reader of the Belfast Agreement, I notice that the Trade and Business Development Body is not one of the 12 implementation bodies listed in the agreement. Will the Minister confirm that his enthusiasm for all-Ireland bodies is now so great that the 12 bodies that were presented to the electorate during the referendum campaign are insufficient and must now be added to? Does the Minister plan to add on any more implementation bodies, and will he indicate to the House the cost of the Trade and Business Development Body? Have those 12 bodies reached such a state that the Irish Government are now presenting papers about enhancing competitiveness in the Northern Ireland economy? Is that the route that implementation bodies will take in the future?

Photo of Reg Empey Reg Empey UUP

The hon Member obviously mis- understands. The Trade and Business Development Body is one of six implementation bodies set up under the Belfast Agreement. There are 12 areas of co-operation: six are being dealt with through implementation, and six through co-operation, where there is no formal structure.

This body has been in operation from the outset. Its remit has not been altered, added to, or detracted from. In the report made to the House following the meeting of the North/South Ministerial Council in September, reference was made to the paper presented by the Irish Government. The matter was then referred to this body for further consideration. Anyone can issue a report and put it forward for consideration and it has no bearing on who will make the final decisions on the Northern Ireland economy. That will continue to be the remit of this Assembly, acting through the Executive and the Departments, and there will be no change to that.

So far as this body is concerned, areas of co-operation in a range of activities have been ongoing for many years between the economies on both sides of the border. There are more than 150 areas of co-operation, projects, joint discussions and joint working parties. These all operated prior to devolution without input or control from anyone in Northern Ireland. They are now under the Assembly’s control, and Members have the right to question what is going on. No decisions with regard to finance or other matters can be taken without the approval of the House.

Photo of Dr Dara O'Hagan Dr Dara O'Hagan Sinn Féin

Go raibh maith agat, a Cheann Comhairle. Will the Minister go into further detail on the four areas for consideration that InterTradeIreland has undertaken? How far advanced is the work?

Photo of Reg Empey Reg Empey UUP

Four areas of co-operation were set out in the agreement of 18 December 1998: a North/South equity investment fund programme; the development of graduate and other placement programmes; the carrying out of a range of testing services; and the implementation of standards development and certificate programmes on a North/South basis.

Reports were presented on those areas of co-operation. With regard to carrying out a range of testing services for industry, the report came to the conclusion that no value could be added by the body pursuing that, and the recommendation was not to pursue the matter further. That was accepted by the North/South Ministerial Council.

The implementation of standards development and certificate programmes on a North/South basis was also felt to be an area where the body reported that it could not add value. It was accepted, therefore, that that would not be pursued.

With regard to the development of a North/South equity investment fund, the IDB commissioned a study into small and medium-sized (SME) enterprise finance, which is currently under way. The body has been asked to further refine its proposals in association with the IDB because we do not want duplication or crossover. The Trade and Business Development Body will study the proposals brought forward through that research to ensure there is no overlap.

My Colleague Dr Farren is closely involved in the development of graduate and other placement programmes. He believes that considerable progress can be made, and he is taking that forward at departmental level because some placements have already been completed. That has been happening for years in the private sector, and Dr Farren believes that further progress can be made through graduate placements. It is similar to the explorers programme that the Department runs every year in which people work abroad, where they have the opportunity for exchanges and for developing networks. The intention is to do something similar between Northern Ireland and the Republic. It is a solid proposal, and Dr Farren is pursuing it enthusiastically.

Photo of Mr James Leslie Mr James Leslie UUP

I read the proposal for a North/South equity investment fund programme with some curiosity and a degree of concern. Whose equity is it? What will it be invested in? Is it a Government-backed programme? If so, will the Minister be mindful of the exceedingly mixed record of such programmes? In the past, normal private sector investment disciplines have been disregarded in pursuit of political objectives.

Photo of Reg Empey Reg Empey UUP

The body was originally asked to investigate the four issues that I mentioned in my statement, one of which was North/South equity investment. That was over two years ago and the products available through equity investment have changed significantly since then. More products have come onto the market, and more people are involved, but there is still a lack of enthusiasm and a consequent lack of projects.

We are at an early stage. A report has been produced on what is available, as has a study of SME finance, commissioned simultaneously by the IDB. We will look at the two reports to see what is required. We may need a public-private partnership, if funds can be generated, but we must take into account the implications of providing state aid.

As yet, no firm proposals have been developed. We want to see that there is a gap in the market that is not filled by the private sector or by existing funds. We must also take account of the fact that the European Union has put a short-term embargo on a range of equity capital funds, including, for example, the Viridian growth fund. The Department of Trade and Industry has also found that several of its funds have been affected. The matter still has some way to go, and I have no particular proposal to put to the House at this stage.

Photo of Joe Byrne Joe Byrne Social Democratic and Labour Party

I welcome the Minister’s statement and congratulate him on his efforts to promote North/South trade. I am glad to hear that the North/South Ministerial Council considered the paper on enhancing the comp- etitiveness of both economies, North and South. Does the Minister agree that this is an important issue, given that Northern Ireland is too dependent on the public sector for economic regeneration? Will the Minister assure the House that his Department will treat the promotion of private sector enterprise as a priority? There is much potential for the development of SMEs and indigenous local enterprise.

Photo of Reg Empey Reg Empey UUP

I agree with the Member’s sentiments entirely on general economic policy. However, the main vehicle for generating more private sector business start- ups will be the general economic policies pursued by this Administration and by the Government in London. Through the Trade and Business Development Body, we can promote a range of initiatives — including the supply chain initiative — aimed at generating new business. To people who express concerns about such developments I say "Do you not want to do more trade on this island or with other European Union partners?" More trade is in everybody’s interest, and at present there is remarkably little.

12.00

Although our exports to the Irish Republic have been growing, the level of trade between the two economies is still remarkably small considering they share a land border. It would certainly be a lower proportion than between other economies in the European Union, such as France and Germany. We can generate more private sector investment if we can increase the total volume of trade. It is just as effective as inward investment.

(Mr Deputy Speaker [Mr McClelland] in the Chair)

If close neighbours can trade with one another, it is right to encourage that. In doing so, we will strengthen our economy. I acknowledge that we are still over- dependent on the public sector. That needs to be corrected if we are to have the basis to sustain the services we wish to provide for our community well into the remainder of this century.

Photo of Ian Paisley Jnr Ian Paisley Jnr DUP

Roadshows were mentioned in the statement. I know it might disappoint some of his groupies over here, but does the Minister agree that this all-Ireland ministerial roadshow is a disaster for Northern Ireland? Is it not about time that he, as Minister, told Dublin to get on its bike on the road out of Northern Ireland, instead of coming into Northern Ireland more and more?

The Minister mentioned the development of graduate and other placement programmes on a North/South basis. What reassurances can he give the House that these appointments will be open to members of the Protestant community and equally shared across the community in Northern Ireland?

In the penultimate paragraph of the statement, where creeping Nationalist-speak appears to have taken over, the Minister talks about "the South". I assume he means the Republic of Ireland. Will he assure us that he will refer to Northern Ireland and the Republic of Ireland by their designated titles in all future communiqués from his Department, and not allow this Nationalist-speak to creep in?

Photo of Reg Empey Reg Empey UUP

First, to say that the roadshows were a disaster is rubbish. The turnout for all of them has been exceptionally good. If the Member had gone to the roadshow at the Hilton Park Hotel in Templepatrick or the meeting the following morning in Belfast City Hall, he would have seen 150 business people, all interested in whether there was any possibility of doing business with one another. It was the same in Dublin and Limerick, and I have little doubt that the roadshow in Londonderry is already oversubscribed.

I think it is good to increase business. If it is mutually beneficial, I cannot understand what the difficulty is. Companies, including some in Mr Paisley’s own constituency that depend on orders from the Republic, come to me to find out how they can increase trade. That is right and proper. I do not understand what people are worrying about, because that is exactly what it is about.

Prior to devolution a huge volume of cross-border activity was being undertaken by previous direct rule Administrations. Over 150 bodies or projects were ongoing, and not one of them was subject to approval by anyone here. Most people in Northern Ireland knew nothing about it. Every six months a list of the areas of co-operation was put into the Library of the House of Commons. No one was able to stand up and ask the Minister any questions about it.

I am conscious of the point the Member makes about language, but, with the greatest respect to him, I will use my own language because I know what I am talking about and I know what I mean. If companies wish to offer graduate placements to individual employees, all those people will have that opportunity, just as everyone has the opportunity to apply for the explorers programme.

Whether a person of a particular religion is going to make himself available is a matter for him, not me, but everybody should have the opportunity to take it up. My Colleague Dr Farren is responsible for this area. I am sure of his commitment to fairness; I have no doubt that he is committed to ensuring that everybody has an equal opportunity to participate. If the Member wishes to put forward any names, I will ensure that they are passed on to the appropriate authorities.

Photo of Edwin Poots Edwin Poots DUP

In case the Minister would mislead the House, can I ask him to indicate which part of the Belfast Agreement envisaged the setting up of the Trade and Business Development Body? From the annex to the agreement, it is quite evident that it was not envisaged. This body was set up as a result of the Ulster Unionist Party being prepared to give further concessions to Nationalism. The Minister also failed to answer my Colleague’s question about the cost of setting up the body, so perhaps I can ask him again. How much did it cost to set up the new offices in Newry, and what is the estimated cost of running the Trade and Business Development Body?

I also want to ask the Minister about the implementation of standards, development and certificate programmes on a North/South basis. Has this not already been done under the European Union? What is the relationship between this and what we currently have, the BS5750?

Photo of Reg Empey Reg Empey UUP

I think the Member did not hear one of my previous answers regarding item four. I indicated that the body had investigated this and felt that no added value could be achieved by pursuing it any further. The North/South Ministerial Council agreed with that, and the matter is therefore no longer part of the agenda of this organisation.

My Colleague Mr Durkan expressly set out the cost of the North/South Trade and Business Development Body in his Budget statement. I cannot answer the question about the cost of the headquarters in Newry with precise figures, but I am happy to write to the Member accord- ingly. I do not know why he persists in trying to say that this body was not envisaged in the agreement. It is one of the six implementation bodies. If it was not set up by the agreement, why does it have a budget, and why have I have been reporting to the House regularly since it started?