Growth of 1.5pc predicted for 2012 but people have to start shopping again
THE quarterly outlook from Bloxham Stockbrokers predicts that the country's economy - as measured by GDP - will grow by 0.8pc this year and by 1.5pc in 2012.
This compares favourably to revised growth forecasts from the Central Bank earlier this week of 1pc for 2010 and 0.8pc for next year.
Bloxhams said the slowdown in the world economy could not have come at a worse time for Ireland, because of the importance of the export sector to our recovery prospects.
But it added that despite the likely slowdown in the second half of the year, the ongoing strength of exports is likely to support manufacturing output over the coming months.
Bloxham economist Alan McQuaid says it is crucial to wean consumers off their savings and get them back into the shops.
And he says that if consumer confidence is to be restored in Ireland then the employment situation needs to improve ''dramatically''.
''The bottom line is that households need to be incentivised to spend their money either directly, or indirectly through targeting the labour market with economic initiatives to boost employment numbers,.’
Mr McQuaid added that he believes that Finance Minister Michael Noonan should ‘'err on the side of caution’’ in the forthcoming Budget and deliver no more than the €3.6 billion promised in Ireland's bail-out programme.'’
''The main aim at this stage should be to protect growth so we can generate the revenues going forward to meet our budgetary targets rather than just implementing measures in the Budget in a crude mathematical exercise.’’