The AIB Brexit Sentiment Index for Q3 2018 reveals 62% of Northern Ireland SMEs believe Brexit will have a negative impact on their business, up from 50% in Q1 2018. This compares with 63% of SMEs in the Republic of Ireland (RoI). At the same time Northern IrelandSMEs are more likely to feel the negative impacts of Brexit now at 37% compared to 25% in RoI.
Conducted by Ipsos MRBI, the Index is a quarterly survey of more than 700 SMEs in Northern Irelandand ROI that assesses the attitudes of SME business leaders on Brexit and its impact on their businesses. In terms of the overall sentiment where the baseline is zero, with a potential range from +100 to -100, the latest Index registered a score of -35 in Northern Ireland, slightly up from -37 last quarter. This compares with -41 in RoI, down from -37 in Q2, suggesting RoI businesses have become slightly more negative in outlook when it comes to the impact Brexit may have on their business. The Index shows SMEs operating in retail (-39), manufacturing (-30) and tourism (-33) are the most pessimistic in terms of sentiment.
Speaking about the latest findings, Brian Gillan, Head of Business and Corporate Banking, First Trust Bank said; “Another quarter closer to Brexit and not much meaningful progress on the negotiations has produced little change in the AIB Brexit Sentiment Index for Northern Ireland– only showing a marginal lift from -37 last time to -35 this quarter.
“The main source of negativity for Northern IrelandSMEs is still the lack of visibility as to what Brexit means for them, standing at 85%. There is little doubt that the lack of certainty as to what is going to happen is impacting decisions here – with 45% having postponed or cancelled plans and a further 13% having reviewed them. In additional 11% have said they have postponed bank borrowing as a result of Brexit. The long-term impact of these delayed decisions is the most worrying aspect of this situation as they could negatively impact the competitiveness of local businesses, especially those operating in export markets.”
AIB’s quarterly Brexit Index helps inform First Trust Bank about the needs and solutions required by customers as plans for Brexit progress.
Speaking about the need for local businesses to plan for Brexit, Brian concluded; “Against this backdrop of continued uncertainty planning for Brexit remains stubbornly low with 63% of SMEs here having no planning started at all. We do take some heart that those who have either a formal plan or started their investigations is now at 37% – the second highest level for the last year.
“With March 2019 looming large, we would continue to urge all companies to start this process sooner rather than later and to seek help from their key advisers to get them started on the road to understanding the challenges and opportunities presented by Brexit.”