Economic downturn - A truly vicious circle

THE amount of bad debts is a measure of any economic downturn. These have almost doubled in this country in the past five years, and they are likely to increase by another 30% to more than €250 million in the next 12 months.

Various factors are being blamed for the rise in bad debts, such as the rise in oil and commodity prices, along with the increases in interests rates, compounded by the worldwide banking problems.

The banking sector essentially seeded bad debts by the reckless rush to provide easy credit to consumers in recent years.