World

Saturday 12 July 2014

Ireland has turned corner and on way to recovery, says Barroso

Peter Flanagan and Donal O'Donovan

Published 01/03/2013|04:00

  • Share
Taoiseach Enda Kenny TD and EC President Jose Manuel Barroso following their meeting at Government Buildings

EUROPEAN Commission president Jose Manuel Barroso hailed Ireland's recovery, saying the country is "turning the corner" and well on the road to recovery.

  • Share
  • Go To

Speaking in Dublin yesterday, Mr Barroso said Ireland was a shining example of how a country can recover after it has been bailed out.

"Confidence is returning to Ireland and to Europe," he told executives at a conference organised by IBEC.

"The Irish economy is turning the corner. The employment figures just published suggest clearly that this may be happening. It shows that the programmes can work.

"It shows that there is light at the end of the tunnel and it shows that you can be part of creating that positive, growth-enhancing climate," he claimed.

Asking his audience of chief executives and business leaders to "choose growth", Mr Barroso warned that while confidence was returning to the eurozone, the region itself was still weak.

"The situation remains fragile and there are unacceptably high rates of unemployment in many member states, and growth rates remain, generally speaking, very depressed," he admitted.

Growth

"Getting and keeping Europe on the path to sustained economic growth remains a formidable challenge."

The positive outlook for Ireland matched new analysis from global bank Citi.

Its latest research says this country will be the only so-called "peripheral" euro member to escape a new recession this year. Citi said it no longer believes lenders to the Government here are at risk of losing money, and that rating agency Moody's will lift our debt rating within the year, from so-called junk status to lower risk investment grade.

That good news for us is in contrast to the situation elsewhere.

Lenders to Cyprus, Portugal, Italy, Spain and Greece could all lose money and Greece is likely to leave the euro, the report said. The EC issued similar forecasts last month.

Back in Dublin the EU president made a pitch for deeper European integration.

"Mistakes of one country can have a huge effect on the euro-area economy and Europe as a whole," he said,

"Increased pooling of economic policy-making [should] be matched by an increase in democracy and accountability at European level."

Mr Barroso's broadly optimistic tone was echoed by Taoiseach Enda Kenny, but the Taoiseach made clear that while Ireland has made huge strides, it still had a way to go to be out of the woods.

"We have a set of enormous challenges ahead of us," he said.

Complacency

"There has been a lull in the consternation that overtook Europe for a number of years, but there is absolutely no room for complacency and no time to waste in dealing with these problems," he said.

In what will have been music to the ears of his audience, Mr Kenny strongly defended Ireland's corporate tax regime, which has come under pressure from other countries in recent months.

"Our tax policy is based on three things: the rate, the regime across the board, and our reputation when it comes to tax affairs. "Our system is completely transparent and highly incentivised, and our tax policy will continue," he said.

The fall-out from Italy's general election continues to be the background to all discussions about the European situation. It's a sign that the euro crisis is not over, according to Moody's.

The sovereign debt markets remain vulnerable to shocks to investor confidence because of the lack of economic growth.

In its latest update to the market, Moody's said that was why its outlook for most euro area countries remained negative for now.

The rating agency said it wouldn't change those ratings based on calmer markets alone, but also on an end to the economic and political pressures facing the country.

Irish Independent

Read More

Classifieds

CarsIreland

Independent Shopping.ie

Meet, chat and connect with
singles in your area

Independent Shopping.ie

Meet Singles Now

Findajob

Apps

Now available on

Editors Choice

Also in Business