20 December 2002 Edition
Economic fallout - Now is time to invest
BY ROBBIE MacGABHANN
A substantial fall in IDA job figures and a bleak economic outlook are just the latest pointers in an economy that is clearly in a substantial downward cycle. The new economic data was ignored by the Dublin Government, who have yet to show any real vision on how we can ensure maximum employment through the ongoing recession.
Nearly 10,000 less new IDA jobs were created in 2001 compared to last year, according to new figures, released by the agency this week. This meant a fall in the number of IDA-backed jobs in the 26 Counties, from 141,137 at the end of 2000, to 137,272 this year.
IDA chief executive, Seán Dorgan, believes that the slowdown in the Information and Communication Technology (ICT) sectors is the core reason for the slump in IDA job creation.
The 26-County economy is set to stand still next year, according to International Monetary Fund (IMF) figures that show economic growth falling to 3% in 2002. With inflation at 3.3% this year, the IMF figures show an economy that has effectively stopped growing.
The need for a radical u-turn in government economic policy has never been more clear. One ignored solution is to use this lean period as a time to reinvest in our badly under-funded infrastructure, particularly in the area of ICT, transport and power. These three areas are vital to the future economic well being of, not just the state, but the whole island economy.
The budget only earmarked £55 million in state funds for investment in new broadband services. The need for investment in power and ICT areas has been left almost totally up to private sector interests. The problem here is that private sector companies have only the short-term interests of profits and shareholder demands driving their decision-making. Depending on the private sector to invest long-term in the Irish economy is a pipe dream. There is a clear role for a vibrant dynamic state role in the development of island-wide infrastructure.
Maybe the coalition cabinet will ponder this reality over Christmas and remember that you need economic policies for the bad times as well as the good.
A substantial fall in IDA job figures and a bleak economic outlook are just the latest pointers in an economy that is clearly in a substantial downward cycle. The new economic data was ignored by the Dublin Government, who have yet to show any real vision on how we can ensure maximum employment through the ongoing recession.
Nearly 10,000 less new IDA jobs were created in 2001 compared to last year, according to new figures, released by the agency this week. This meant a fall in the number of IDA-backed jobs in the 26 Counties, from 141,137 at the end of 2000, to 137,272 this year.
IDA chief executive, Seán Dorgan, believes that the slowdown in the Information and Communication Technology (ICT) sectors is the core reason for the slump in IDA job creation.
The 26-County economy is set to stand still next year, according to International Monetary Fund (IMF) figures that show economic growth falling to 3% in 2002. With inflation at 3.3% this year, the IMF figures show an economy that has effectively stopped growing.
The need for a radical u-turn in government economic policy has never been more clear. One ignored solution is to use this lean period as a time to reinvest in our badly under-funded infrastructure, particularly in the area of ICT, transport and power. These three areas are vital to the future economic well being of, not just the state, but the whole island economy.
The budget only earmarked £55 million in state funds for investment in new broadband services. The need for investment in power and ICT areas has been left almost totally up to private sector interests. The problem here is that private sector companies have only the short-term interests of profits and shareholder demands driving their decision-making. Depending on the private sector to invest long-term in the Irish economy is a pipe dream. There is a clear role for a vibrant dynamic state role in the development of island-wide infrastructure.
Maybe the coalition cabinet will ponder this reality over Christmas and remember that you need economic policies for the bad times as well as the good.