Tuesday, June 05, 2007

Dan McLaughlin, Chief Economist at the Bank of Ireland, says that he expects the Irish economy to grow by 5% in the medium term

The Post:

A leading economist has stated that Irish economy is currently in a “very strong shape” and slammed reports that did not give a true picture of how the economy is performing.

Speaking on RTÉ radio, Dan McLaughlin, Chief Economist at the Bank of Ireland said that that he does not know where all the negative talk about economy is coming from because he feels that the situation “very healthy”.

He was echoing recent comments made by the Bank of Ireland’s chief executive Brian Goggin who warned about the dangers of “talking the country into a recession”.

Mr McLaughlin said that “misleading headlines” in the media were not giving a true reflection of economic reality and were “taking things out of context”.

He said that reports about the rising number of redundancies, was one such example.

He said that the number of redundancies in Ireland per is currently 2,000 per month, or 24,000 per year.

“That has been pretty constant over the last five or six years,” he said, adding that tens of thousands of new jobs have been created over the same period of time.

“Redundancies are a fact of every modern dynamic economy, even one as successful as Ireland's,” he added. “Newspaper headlines are one thing the reality of the economy are another.”

Mr McLaughlin said it was “completely ridiculous” to suggest that “suddenly in 2008 that the economy will fall off a cliff.”

He said that the available indicators are that the economy is broadly growing at the same pace as last year at around 6%, and that he expects that the economy will grow by 5% in the medium term.

He said that in the first three months of 2007 retail spending, car sales, employment and exports and industrial production are up.

He said that he has no problem with predictions that things will slow down over the next five to 10 years, but said it was “difficult to believe that it will decline sharply in the next few years”.

He added that a slowdown in the rate of economic growth does not mean that the economy will decline.

“People see recessions around every corner,” he said.

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