The environment for SMEs shows notable improvement as economy continues to grow strongly, according to SME Market Monitor9th March 2018
The latest EY-DKM/BPFI SME Market Monitor, March 2018, prepared by EY-DKM Economic Advisory Services and published today by Banking & Payments Federation Ireland (BPFI), shows that the current environment for SMEs is encouragingly positive, but concerns exist with regards to international factors.
Tracking trends across 15 different indicators which are important for the performance of the SME sector, the latest EY-DKM/BPFI SME Market Monitor shows that the majority of indicators tracked are encouragingly positive. At the same time, the Monitor points to factors as Brexit and corporate tax proposals in the US as presenting possible challenges in the medium term; and EY-DKM’s Annette Hughes notes this as well as the strong positives in her commentary:
“The upward trajectory of the Irish economy and the fact that Ireland, for the moment, has weathered Brexit and other global concerns better than had been feared seems to have consumers and manufacturers more confident. Although the outturn of Phase 2 of Brexit negotiations and changes in US tax policies may disrupt this growth, the SME environment remains considerably positive with policy announcements such as the National Planning Framework (NPF) and the National Development Plan (NDP) offering further opportunities for Irish enterprises, including SMEs. Given that the NDP commits €116 billion to upgrading the State’s infrastructure over ten years, SMEs should benefit either directly, in the contracting phase, or indirectly from the provision of good and services to firms directly involved in the delivery of projects.”
Consumer and business sentiment remains strong, while continued increases in income, albeit modest, and employment are supporting increased consumer spending. Hughes also points to positive developments in the areas of debt reduction and new lending:
“The level of debt accumulated by Irish SMES continued to fall, reaching €12.5 billion in Q3 2017. This represented a decline of €1.7 billion or 11.9% YoY. Furthermore, the opening nine months of 2017 saw total new lending to SMEs rise to €1.97 billion, up 13% or €227 million on the corresponding period in 2016.”
“In summary, the Irish economy continues to grow strongly this could change in the medium term, depending on the outcome of global risks, government infrastructure programmes from the NPF and NDP which all should offer further opportunities to SMEs across the country.”
The EY-DKM/BPFI SME Market Monitor can be viewed on the BPFI website here.
Note: Banking & Payments Federation Ireland is the voice of banking and payments 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 EY-DKM Economic Advisory Services, Ph: 01 6670372
Keira Doyle, Head of Communications, BPFI, Ph: 01 4748835 / 086 269 4460