Cliff Taylor in the Sunday Business Post under the heading "Carry on Spending" is as puzzled as I am in wondering why the normally cautious Department of Finance isn't "talking down" the economy and is sticking to the Budget Day forecast of 5 percent annual growth. His point is that trade, the motor of the economy for much of the boom period, is slowing down and is now dragging back growth.
His article is worth reading in full because he seems to be indicating, without making it explicit, that Ireland's economic model may be undergoing a paradigmatic shift, with a de-emphasis on export lead growth and a shift towards domestic consumption as the mainstay of future economic growth. He points out all the obvious pit falls in such a scenario but I think that considerably more scepticism is warranted and I think that Taylor somehow avoids the more pessimistic conclusion that is the ineluctable consequence of the trends he has outlined.
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