Brexit uncertainty- will retailers be hit when NI economy contracts 15%?

Brexit uncertainty- will retailers be hit when NI economy contracts 15%?
Sainsburys say supplies of some items - such as fish, meat and dairy - may be affected post-Brexit

A mix of Brexit uncertainty and Covid-19 restrictions could see Northern Ireland’s economy contract by around 15 per cent in 2020, according to a new report from Ulster Bank.

The bank’s latest survey of businesses found that the partial lockdown during October contributed to further economic stagnation.

After recording a rise in output over the course of the third quarter, Ulster Bank’s Purchasing Managers’ Index (PMI) said that growth slowed again in October, largely due to the coronavirus pandemic.

The lender’s chief economist Richard Ramsey said the Northern Ireland economy is now set for an annual decline of around 15 per cent, more severe than some other forecasts.

Danske Bank has reported that it expects to see Northern ireland’s economy slip by 11 per cent.

Brexit uncertainty

When juxtaposed with ongoing Brexit uncertainty, the winter looks bleak – with some supermarkets worried that supply of some items may be at stake.

Sainsbury’s has said the supply of some fish, dairy and meat products to Northern Ireland could be reduced from January because of Brexit.

“If we don’t get greater clarity on the Northern Irish situation then we will see a restriction on the ranges of products we can sell. This is not one or two products in stores I am talking about, it is a substantial number of products and quite key, everyday products too” Simon Roberts, Sainsbury’s chief executive told The Guardian.

Supermarkets’ supply chains will be hit by Brexit whether there is a free trade deal or not between the EU and the UK because the Northern Ireland protocol kicks in at 11pm on 31 December, he said while indicating that the industry had met with government last week to seek clarity.

Sainsbury’s has 13 stores in Northern Ireland. Rivals Tesco has 55 stores here, and Asda has in the region of 20 superstores in NI.