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Colm McCarthy: Borrowing for non-essential projects will delay recovery

Economic activity in Ireland, as measured by the level of real GNP, was down 15 per cent from the end-2007 peak in the first quarter of this year. If the economy finally begins to recover next year, it is unlikely that the 2007 level of GNP will be reattained any sooner than about 2017. There will have been a full decade of zero growth.

Government investment intentions, as expressed in the National Development Plan 2007-2013 and published in January of the final bubble year of 2007, were based on the expectation that economic activity would expand by about 50 per cent over the subsequent decade.

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