‘Recovery set to continue next year’

IRELAND’S economic recovery will continue to gather momentum next year while its attractiveness as a business environment has not changed.

That is according to PricewaterhouseCoopers chairman Dennis Nally, who added that the country is slowly headed in the right direction towards creating jobs, strengthening consumer consumption and increasing investment.

Addressing yesterday’s IBEC CEO Conference at Dublin’s Convention Centre, Mr Nally said: “With its reliance on exports and openness to the global economy, Ireland is still vulnerable. As a result, there will be more difficult decisions ahead. But, if they are addressed with the same determined willingness to change — with the same great Irish spirit of resiliency — the Irish recovery will continue to gather momentum in 2012.”

In the run-up to the conference, IBEC chief Danny McCoy suggested that “all of the jobs lost during the recession will be regained over the coming five years”.

Mr Nally said Ireland’s attractiveness remains rooted in its tax structures and highly educated and skilled workforce. However, he said Ireland depends too much on the US and EU for growth and should look at developing markets like China to drive growth further.

Allergan Pharmaceuticals Ireland head Pat O’Donnell told the conference that those same emerging markets — hungry for their own slice of the foreign direct investment pie — remain a big threat to Ireland.

However, while business costs and infrastructure still need improving, our legal framework for protecting intellectual property, our positive tax structures (including corporation tax and R&D tax credits) and our skilled workforce, mean Ireland remains an attractive market. But he did warn of a potential lack of R&D-savvy graduates in the coming years.

Addressing the conference, Finance Minister Michael Noonan defended his decision to increase VAT in next month’s budget and explained why spending cuts might not meet IBEC’s desired amount: “We should remember that one person’s expenditure cut is another person’s public service.”