When the traditional summer marching season draws to a close in Northern Ireland government investment bodies tend to breath a collective sigh of relief.

Investment invitations to overseas companies can once again be issued with a degree of confidence that there is less likelihood of major unrest on the streets than during the summer months.

July is now officially a "no-go month" for business in the North according to all of the major business bodies.

The Confederation of British Industry firmly believes Northern Ireland now has an 11-month economic calendar as the North becomes a restricted area for both businesses and tourists during what should be two of the busiest months of the year.

For a brief moment in July this year, officials at the Industrial Development Board thought that this cycle might look as if it were coming to a welcome end.

Drumcree Sunday, as it has been titled in the North - the Sunday preceding the annual 12th of July celebrations - had passed off without incident.

Drumcree had in previous years become the focus of an intense standoff between the Orange Order and the Royal Ulster Constabulary following a Parades Commission ruling that the order could not march from a church in Drumcree down the mainly nationalist Garvaghy Road.

It is estimated that the Drumcree standoff has cost Northern Ireland £1 billion sterling in the last six years.

This year there was no standoff, the day passed peacefully and senior executives at the Industrial Development Board began to hope that the North had emerged with its image as an investment location intact for the first time since 1995.

According to Dr Alan Gillespie, chairman of the Industrial Development Board, images of unrest in the North set the agency back in its task of trying to profile Northern Ireland internationally.

"Over the last five years IDB has had the confidence to go out and brand Northern Ireland in a fresh, compelling way and to market Northern Ireland - you can see evidence of that all around Northern Ireland and in the IDB's job numbers.

"When you come to the summer of 2001, what was particularly disappointing to me was that we didn't have a particularly bad weekend at Drumcree and the following Monday morning we all thought 'gosh, business as usual, isn't this wonderful?'

"We thought that maybe our tourist economy wouldn't be hit the way it normally is in July and Drumcree passed without being a flareup, and what we should realise is that the world watches us and when nothing happened in Drumcree they all noticed that," Dr Gillespie added.

But then, just days after Drumcree, angry images of rioting on the streets of Belfast replaced one headline for another and Northern Ireland took up its familiar place on the front pages of newspapers from New York to South Africa.

Sir Reg Empey, Minister for Enterprise, Trade & Investment, readily agrees that media images of disturbances on the streets of Belfast promote a very negative image "and do absolutely nothing to help us sell Northern Ireland as an investment location."

"Political uncertainty and instability are barriers to what we are trying to do in Northern Ireland," says Sir Reg. "We want to be able to attract international mobile investment ... we want to create thousands of new jobs and deliver a new soundly-based economic environment, but the truth is that unless we can overcome the political hurdles that stand in our way, we will not achieve our full potential," Sir Reg said.

He believes that its growth achievements have been impressive to date.

"Our economic growth has continued throughout the 1990's, irrespective of the political situation, albeit that we have the potential for greater growth - providing our problems are resolved," he added.

According to Mr Stephen Kingon, managing partner of PricewaterhouseCoopers in Northern Ireland, the fact that the North did not witness the widespread violence that was seen in previous years during the summer months, but rather sporadic rioting, is immaterial in the eyes of potential investors.

"Investors view Northern Ireland initially by perception rather than reality. When the global economy is slowing and the Northern Ireland peace process appears to be in difficulty, then the perception of Northern Ireland as an investment location will be significantly reduced," Mr Kingon said.

"You cannot assume that investors will react to the security situation alone. Northern Ireland has to deliver a strong overseas perception of political security and stability. Investment goes where it is profitable, welcome and safe. Northern Ireland has to deliver that message," he added.

Recent research carried out by PricewaterhouseCoopers shows that there is a direct correlation between business confidence and political progress. In the business adviser's recent Economic Review and Prospects 2001 report more than 90 per cent of Northern Ireland's key employers said that any change in the current political status quo in the North would have a direct impact on the economy.

PricewaterhouseCoopers interviewed 263 of Northern Ireland's leading businesses as part of the annual report.

In a similar survey conducted by the business adviser in May last year, 29 per cent of the companies which took part in the exercise said they would reduce investment plans for Northern Ireland if the Assembly were to collapse or be suspended.

A year later, the corresponding figure had risen to 88 per cent. In addition, between 92 per cent and 100 per cent of all overseas-owned companies also indicated that any previously planned investment would either be reduced or postponed in light of any change in the North's political situation.

According to Mr Kingon, any threat to the perception of political and security stability could adversely impact business confidence and ultimately, investment.

His concerns are shared throughout the business community in the North, according to Mr John Stringer, chief executive of the Northern Ireland Chamber of Commerce, which is a member of G7 - the umbrella group that represents the major business bodies and trade unions in the North.

Mr Stringer said the body is concerned about Northern Ireland's current image in the global investment community.

"We believe that this summer in particular, because of the unrest on the streets of Belfast and the coverage this attracted from international media, will be a problem going forward.

"In the short to medium term it will have an impact on our tourism industry but longer term it will also affect our inward investment potential.

"The story going out of Northern Ireland was very negative this summer and although the reality is very different in Northern Ireland than what is portrayed on television, graphic images of the incidents we have seen this summer are very negative," Mr Stringer said.

The Institute of Directors is also a member of G7 and Mr Eric Bell, the Northern Ireland chair of the body, believes there is a widespread sense of disappointment among the business community about how the North is now perceived.

"I have just come back from Canada and Northern Ireland was on the front pages of the Toronto Globe. So people out there in the marketplace are reading about what is happening in Northern Ireland.

"There are a lot of very aggressive, hungry regions in the world who want to attract jobs, the global investment market is very competitive, and why are they going to consider Northern Ireland as a location at this time?

"Until political uncertainty is taken out of the equation, we are not going to be able to compete in the world," Mr Bell added.