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Dublin: 13 °C Thursday 2 July, 2020
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Irish firms are more upbeat about the country's economic fate

A new IBEC index out this morning suggests Irish businesses are much more upbeat now than they were six months ago.

Image: William Perugini via Shutterstock

IRISH BUSINESSES are much more upbeat about an economic recovery now than they were in previous months, according to a new index out this morning.

IBEC’s Business Sentiment Survey suggests a “significant” increase in confidence among Irish firms, despite what they see as a disappointing performance in the first half of the year.

The confederation says the increase in positive sentiment is promising news on the employment front, as most firms operate within the Irish market and are therefore likely to start recruiting to fill their extra workload.

Of particular interest is the gap in sentiment among firms selling to the domestic and exporting markets – with domestic optimism turning positive after a sustained period of negativity, as firms move towards the closure of the ‘two-speed’ economy.

The optimism of exporters remains, however, despite ongoing fears of a sustained double-dip recession in many European countries where Irish firms sell their wares.

“At last we are seeing firm signs of a domestic recovery,” said IBEC chief economist Fergal O’Brien.

“While the environment remains challenging, companies are looking to the future with a increasing sense of optimism. Over recent months we have started to see the economy re-balance, with the domestic sector contributing to growth. The survey suggests this trend will continue.”

IBEC has warned, however, that a domestic recovery could be put at risk if workers are faced with more new taxes.

“To support the recovery, the government should abandon plans to increase taxes in the upcoming budget,” O’Brien argued.

“The economy and workers are already taxed enough. Any further rises would undermine job creation and make taking up a job less attractive.”

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About the author:

Gavan Reilly

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