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Rising cost of living, housing shortages and Brexit all pose 'threat' to Ireland's economy

The National Competitiveness Council today published Ireland’s Competitiveness Challenge 2018.

Image: Shutterstock/Grianghraf Media

THE RISING COST of living, the potential impact of Brexit and severe housing shortages are all a threat to Ireland’s economic future, according to a new report.

The National Competitiveness Council today published Ireland’s Competitiveness Challenge 2018 report, which looks at our international ranking when it comes to the competitiveness of our economy. 

The report looks at a number of factors when determining the country’s economic forecast, and lays out the potential issues that will affect the country’s competitiveness in the future.  

It finds that as economic conditions continue to improve in the country, Ireland remains “a competitive economy”.

However, Professor Peter Clinch, chairman of the NCC, said that against the backdrop of a worsening international climate, looking at the stats shows the “fragilities in the economy”. 

“Ireland is facing a significant competitiveness loss as the economy heats up and prices and living costs rise,” said Clinch. 

“The overall performance of the economy, and government finances, are dependent on a small number of firms in a small number of sectors.

“Moreover, the majority of Irish-owned firms export a small number of products to a small number of destinations.

The narrow base of enterprises in high value-added sectors, and within sectors, disguises many underperforming firms where productivity growth is stagnant or falling.

Strong outlook

The report finds, however, that despite the negative factors, Ireland’s competitiveness position “remains strong”, but the outlook is “less positive”.

“On closer inspection, there have been some very concerning developments this year, recognised internationally through Ireland’s fall in the major global competitiveness rankings,” the NCC said. 

Issues identified by the NCC as having a negative impact on the country include:

  • Housing shortages
  • Failure to take climate action 
  • Infrastructure issue 
  • Brexit

The recommendations from the NCC state that the country should seek to ensure sustainability in the economic model and maintain cost competitiveness.

About the author:

Cormac Fitzgerald

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