North Ireland is the smallest of the four countries that make up the United Kingdom with a relatively small population. Out of the twelve NUTS 1 regions, its economy is the smallest and is largely based on industry, particularly ship building, rope manufacture and textiles but in the last decades, heavy industry has gradually been replaced by services. Its economy is estimated at €37.3 billion, around two thirds of the next smallest county, North East England; but with a GDP per capita that is greater than North East England and the Wales combined. The country experienced turmoil during the Troubles and it is yet to fully recover from that period.
Northern Ireland economists and politicians secured a commitment with the conservative party to produce a government paper that will examine the mechanisms for changing the corporation tax rates in the region. Its rate had been pegged at 12.5% for corporate investments. This tax rate is one of the lowest in Europe and a major selling point in attraction of firms to locate their businesses in the region. If allowed, the North will have the power to set its own corporate taxes.
The Northern Ireland economic reform group wrote a detailed paper for the need for a Tax review. The Republic’s National Asset Management Agency (NAMA) is expected to acquire loans from five participating Irish banks with a nominal value of about €5 billion to be secured by property assets based in the region. The formation of NAMA is aimed at growing the North Ireland economy by helping new and existing businesses compete internationally and attract investments to the region. As part of the Department of trade and Enterprise, Trade and Investment; the body will provide strong government support for business by delivering its economic development strategies and the implementation of fair investment policies.
During the troubles, North Ireland had very little foreign investment but a lot has changed since the signing of the peace deal with major investments being undertaken in Belfast such as the £400 million Victoria square retail development in Belfast and the water front to cost an estimated £1 billion. Engineering is the largest subsector in the North Ireland economy with aerospace and heavy machinery being at the forefront. Bombardier Aerospace has a base in the region and is its largest industrial employer with five sites in the greater Belfast area. Other heavy manufacturing employers include DuPont, Emerson Electric, Nortel, Northbrook Technology and NACCO.