Businesses in Northern Ireland are dealing with a cost of living crisis and a cost of doing business crisis which has been exacerbated by political deadlock, according to Retail NI.
"Political instability is always bad for business," said Glyn Roberts, Retail NI chief executive.
He was speaking ahead of Taoiseach Leo Varadkar's visit to Belfast where he will meet political leaders and business groups today.
His visit follows Northern Ireland's largest ever trade mission to Dublin last month, during which business groups highlighted the North's "vast untapped potential" and the desire to capitalise on its unique post-Brexit trading position.
"We have a skilled workforce, a steady pipeline of talent from our education institutions, dual market access with the Windsor Accord, emerging clusters in new industries such as tech, cyber security and health life sciences," Mr Roberts said.
"Northern Ireland has many opportunities in the months and years to come, but ultimately we won't realise any of that until we have a working government at Stormont."
Retail NI favours the Windsor Accord which is intended to ease post-Brexit trade between Northern Ireland and the rest of the UK. It is seen as an improvement on the original Northern Ireland Protocol but it does not resolve all its problems, particularly around labelling which will impact retailers.
"We do need to get very clear advice and guidance from the government because let's not forget that much of the Windsor Accord is being brought forward in October and that's only a month and a bit away," Mr Roberts said. "The implementation of Windsor is going to be a challenge so we need to see much more structured dialogue between the UK government, the EU and the local business community."
The Northern Irish economy faces the same challenges as other economies with inflation and rising interest rates dulling consumer spending.
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The Retail NI chief executive said its members are seeing that people are cutting back on what they spend, "perhaps buying much more frozen food than they did before, which is an indicator that people are cutting back in spending".
He said there is a danger that by increasing interest rates like the Bank of England has been doing, really could push the UK into recession in the UK.
Mr Roberts said the UK government has given small businesses in England a 75% reduction in their rates, something small business in Northern Ireland didn't get because the Stormont Executive is not in place.
"We're not able to deal with some of the challenges facing business because we don't have a working government at Stormont."
