Thursday, April 07, 2005

Few obstacles to Irish economic growth

Business World:

Goodbody's chief economist, Dermot O'Leary, has painted a largely optimistic picture of short-to-medium term growth in the Irish economy, forecasting 6% GDP and 5.4% GNP growth this year.

The Q2 2005 Irish Economic Commentary also forecast a major consumer spending boom ahead, helped in large part by the up-coming SSIA windfall with a total of E14.5bn due to be released from the scheme over the course of 12 months starting in May 2006.
This will provide an unprecedented windfall for the Irish consumer and should act as a catalyst for a fall in the current excessively high savings ratios. After a relatively muted period of consumption growth over the past three years (2.9% average since 2002), we expect the Irish consumer to lead the positive economic story over the forecasting horizon.

For next year, O'Leary said he expects GDP and GNP growth to exceed 6% as Ireland's unique demographics among the 15 EU member states point to continued expansion.

The Irish population is forecast to grow by 23% over the next 20 years (reaching about 5.6m), relative to less than 3% in the EU-15. This is underpinned by strong immigration growth rate projections, as well as Ireland having the highest birth rate in the EU.

Related news:

Employment growth driving economy - AIB


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