Seems like like yesterday that Ireland was in recession and losing jobs at the rate of one each and every five minutes. Now the Wall Street Journal reports the nation has officially exited the recession, depending upon export-driven domestic product growth of 2.7 percent for Q1 2010. But the overall consensus among experts is that Ireland has a long road to travel before they reach economic recovery. Entering 2010, Ireland had lost 14 percent off their GDP over two years, making them one of the hardest-hit euro zone countries. Prime Minister Brian Cowen is urging Ireland to be prepared for hard times for the next 10 to 15 years.
Ireland’s recession – Investor medicine needed
Ireland and its recession have continued largely as the country is paying much more on its benchmark bonds than more economically healthy euro zone countries, says the Times. This has given investors pause and has not reduced guaranteed loan borrowing, making it all the more difficult for Dublin to take care of business. Ireland’s primary goal is to restore investor confidence through deficit reduction, but higher taxes, lower salaries for public workers and also the fallout of the burst housing bubble – including an uptick within the origination of low cost loans – have made it difficult for Ireland’s population to wait patiently.
What can exports do for Ireland?
Ireland has previously depended upon the business of info companies like Intel and Microsoft, but this time, they’re hoping exports will fuel their economic recovery. The Times reports that lower public pay and decreasing energy costs are on Ireland’s side within the economic recovery, but lack of jobs in the export market and the falling euro cast a considerable shadow. Wage cuts are making Irish graduates think twice about staying home. They want cash till payday, not the promise of a better Ireland in 10 to 15 years, when experts predict future infrastructure spending will resume.
Cowen worried about 2012
Ireland will escape recession via touch economic choices, says the nation’s government. But it will likely not happen fast enough for Irish voters within the next election. Prime Minister Cowen has promised that the already slashed public salaries won’t go lower, but that might be a case of too little, too late. Irish voters might have had enough.
More information about this topic at these websites:
http://online.wsj.com/article/SB10001424052748703426004575338433422665358.html?mod=googlenews_wsj
http://www.nytimes.com/2010/06/29/business/global/29austerity.html?hp=&pagewanted=all
