SME Market Monitor points way to SME sector recovery

  • Construction SMEs can play key role in driving economic recovery
  • Stronger consumer spending and domestic demand needed to spur SME appetite for investment credit

The DKM/IBF SME Market Monitor July 2014, prepared by DKM Economic Consultants (DKM) and published today by the Irish Banking Federation (IBF), points to construction SMEs as having a key role to play in driving economic recovery.  This is because SMEs account for 95% of persons employed in construction, generating 88% of total turnover and 96% of total value added in the sector.

As DKM’s Annette Hughes, the report’s author, states:

There is real opportunity to grow turnover in the construction sector and deliver much needed jobs, housing and other infrastructure………….Then, through the various output and employment multipliers, the activities of other SMEs can receive a boost as Irish firms supply these firms back through the supply chain and the additional wages generated are spent on Irish goods and services in the wider economy.”

At the same time as profiling the better performing indicators of an improving economic environment for SMEs – including increasing employment and a rebound in the volume of certain categories of retail sales – the DKM/IBF SME Market Monitor points to the ongoing relative weakness of all-important domestic demand.  Linked to this is the demand for funding from SMEs which, despite some positive news on the economic environment, is not increasing to any noticeable extent.  For Annette Hughes the explanation is clear cut:

As previously highlighted, SMEs require substantial and sustained increases in disposable incomes, consumer spending and domestic demand if there is to be a significant change in their attitudes towards seeking funds for investment and expansion as opposed to working capital purposes.”

View the DKM/IBF SME Market Monitor  on the IBF website and www.dkm.ie

Note: The Irish Banking Federation (IBF) is the principal voice of the banking and financial services sector in Ireland, representing over 70 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here.

Contact: Annette Hughes, Director DKM Consultants, Ph01 6670372 or Jillian Heffernan, Marketing Communications Manager, IBF, Ph: 01 4748835 / 087 9016880

Appointment of IFSC Minister Welcomed by International Banks

The appointment by Government of Simon Harris TD as Minister of State in the Departments of An Taoiseach and Foreign Affairs, with special responsibility for the International Financial Services Centre (IFSC), is warmly welcomed by the Federation of International Banks in Ireland (FIBI).

As the voice of international banks operating in Ireland, FIBI has long pressed for the appointment of a Minister to actively and consistently promote at Government level the opportunities for Ireland as a location for international financial services.  The success which Ireland has enjoyed to date as a preferred location for such services is evidenced by the scale and quality of operations based all over the country.  Together they account for some 35,000 in employment and 14% of our exports in 2013.

Furthermore, the most recent research among FIBI members illustrates the extent to which opportunities for further growth exist for the benefit of the wider economy.  International banks here believe the business climate is improving: 69% of respondents foresee an improved business climate over the coming year, while 26% believe it will remain unchanged.  But more especially, they expect this improvement to impact positively on their own operations: almost 60% of respondents expect this improved business climate to translate into increased business activity for their operations, while almost half expect to see it reflected in an increase in the numbers they employ.

FIBI looks forward to a constructive working relationship with the new Minister of State, in particular to collaborating with him in promoting a supportive operational environment for international banking and payment services here that will be of further benefit to the wider economy.

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Note: The Federation of International Banks in Ireland (FIBI), which is affiliated to the Irish Banking Federation, has more than 30 members including many of the largest financial service providers in the world. Our members’ operations extend to the most innovative and dynamic sectors of the financial services industry. FIBI members, based in Dublin’s IFSC and further beyond in all parts of the country, have grown to become some of the most significant contributors to the Irish economy.

Further Information: Jillian Heffernan, IBF Marketing Communications Manager, Ph: 01 474 8835 / 087 9016880