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Wednesday, May 20, 2009

Ireland in Depression

The Republic of Ireland’s economy is in a technical depression but will bounce back faster than the Northern Ireland economy, according to the first major all-island economic forecast.

The Ernst & Young Economic Eye report published this morning predicts that the economy of the island of Ireland will contract by almost 8 per cent in terms of gross domestic product (GDP) this year.

With a decline of more than 10 per cent GDP from its economic height, the Republic will effectively be in depression, it says.

In 2009 alone, the Republic’s economy will contract by 8.9 per cent, the report forecasts. By contrast, there will be a shrinkage of 2.9 per cent in the Northern Irish economy. This will result in a contraction of 7.8 per cent in the all-island economy.

“The island economy is in the eye of an unprecedented economic storm and collateral damage is severe,” said Brendan Lynch, who advised on the report.

“Though early 2009 looks like being the worst period, recovery will be slow and the storm will leave scars on the economic landscape for years.”

Read it all here.

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