Heavy traffic ahead on our road to recovery
Our economic fortunes are now more closely tied to Bilbao than to Beijing
A small trading economy, and Ireland fits the description, cannot escape when things take a nosedive internationally. There are growing fears that this is happening, with agencies like the European Commission, the IMF and the OECD revising their economic forecasts downwards.
Worries about demand, especially in China, have been pushing commodity prices ever lower and now the stock markets have taken fright. Despite Friday's recovery, share prices are well down on the major exchanges for the first three weeks of January. The mood is gloomy enough to have persuaded European Central Bank president Mario Draghi to promise a further relaxation of eurozone monetary policy should the slowdown deepen, and the Bank of England seems afraid to follow the US Federal Reserve in raising interest rates anytime soon.
The speed of recovery in Ireland has been exceptional. Growth in world trade has faltered, forecasts for almost all major economies have been scaled back, and the Davos conference has been hearing some very bearish presentations. The pessimists could be wrong and there is always a chance that the stock market weakness will prove to be another puff of smoke.