While economic renaissance is born of multiple factors, there's little doubt that attractively low corporate tax rates have been instrumental in buoying the Republic's longlasting boom. But as the DUP and Sinn Fein last week tried to hammer out differences over power sharing . . . and stumbled at the first hurdle . . .

the prospect of an economic resurgence seemed to drift further towards the horizon.

But should agreement be reached and be lasting, it's not just Northern Ireland that would benefit. Since the Republic's boom took seed, the differences between it and its neighbour have become increasingly stark.

Anyone over the age of 30 remembers days when the road system in Northern Ireland shamed that of the Republic. The tables have now been turned, with billions of euro pumped into southern infrastructure, even though it's still a very long way from being perfect.

As labour costs in the Republic have soared, Northern Ireland looks that bit more enticing, if only its 30% tax rate could be addressed.

"It is very dangerous to think of corporation tax as a silver bullet, " said the chairman of the Confederation of British Industry for Northern Ireland, Declan Billington. "What good is having a reduced rate if we don't have the skills to meet it, or the infrastructure that we need. We need investment in R&D too, " he said.

Billington reckons that, even with all those elements, Northern Ireland will be capable of creating only an additional 27,000 jobs.

"If we don't have those things in place, then [reduced] corporation tax won't introduce the big sea change. You need all the elements in place."

Billington said that, in the next 10 years, Northern Ireland needs to create 140,000 jobs, leading to fears that an inability to meet this target could spark further social division.

The DUP has called for a short-term corporate tax rate of 10%, but it's unlikely to happen. Chancellor Gordon Brown is unlikely to want to set a precedent that could be used by either Scotland or Wales.

Declan Billington believes some alternative system of allowances could be introduced to provide additional economic stimulus. But would that be enough to persuade companies from the Republic to take a punt on Northern Ireland?

There's already plenty of activity. During the summer, telecommunications group Imagine, established by Sean Bolger, set up a call centre in Armagh that will create over 300 jobs. It received funding of roughly 3.5m from Invest NI.

"It's really a wake-up call for the government here that a company like ours would site an operation in Northern Ireland, " said Imagine managing director Brian O'Donohoe. "If we're doing it you can be sure that other larger companies from the Republic are thinking about it too."

He added that, since the announcement, other companies in the Republic . . . from software and telecoms firms to organisations contemplating locating back office operations such as payment processing . . .

have contacted Imagine to grill it on its experiences across the border.

O'Donohoe said that while lower wage and utility costs have been benefits of working in Northern Ireland, the main motivation was securing a workforce that would have "empathy" with Imagine customers, many of whom have signed up via the Gaelic Telecom venture in conjunction with the GAA.

Trevor Killen, director of Invest NI's Dublin office, cites examples such as Grafton Group and Quinn Group as having established operations in the past five years in Northern Ireland. He said there has been increased interest among indigenous companies from the Republic wanting to explore opportunities across the border.

"The key sectors showing interest are ICT, financial services and manufacturing, " said Killen. "We have a healthy pipeline of projects."

He said about 35 companies, both Irish and multinationals with an established presence in the Republic, have created about 1,500 jobs in Northern Ireland in the past five years.

"The cost base is obviously very competitive, but it's really more about availability of labour and associated skills" he said.

Killen added that companies can typically shave 20% off their wage bills in Northern Ireland compared to salaries in Dublin.

"Historically Northern Ireland was seen as a competitor to the Republic for investment, " Killen explained. "The priority now for companies in the Republic is to continue the very high economic growth rates and they need the people resources to make that happen. Increasingly, they're not seeing Northern Ireland as competition for employment, but as a resource."

David Went, group chief executive of Permanent TSB, lived in Northern Ireland with his family from 1987 to 1997 when he headed Ulster Bank.

He thinks there are new opportunities open now in Northern Ireland for companies from the Republic.

"The problem in an economy such as the Republic's is that, when you reach full employment, you get a higher level of staff turnover. You don't have that same issue in Northern Ireland."

Whatever the outcome of the ongoing power sharing posturing, Northern Ireland has a clear opportunity. It can capitalise on a neighbouring economy that is becoming stretched by dwindling labour resources.

Its corporate tax rate may not be particularly attractive, but some companies in the Republic that are keen to maintain growth momentum may find what they need across the border. Declan Billington certainly thinks so, and indeed continued investment is a necessity.

"We need to trade our way out of the problems we're in.

The only way to do that is to create an environment where foreign direct investment will be attracted, " he said. "We just don't have the critical mass to create jobs here from indigenous companies. About 90% of our businesses employ fewer than 10 people. You have to follow the business model of the Republic: FDI through a competitive tax regime being a catalyst for rapid growth that spins out into indigenous business."