| Economy of Ireland | ||
|---|---|---|
| Currency | 1 Euro = 100 eurocent | |
| Fiscal year | Calendar year | |
| Trade Organisations | EU and OECD | |
| Statistics | ||
| GDP Ranking (2003) [1] | 54th | |
| GDP (2003) | $116.bn | |
| GDP growth rate (2003) | 1.4% | |
| GDP per Capita (2003) | $29,600 | |
| GNP per Capita (2001) | $22,850 | |
| GDP by sector (2002) | agriculture (5%), industry (46%), services (49%) | |
| Inflation rate (2003) | 3.5% | |
| Pop below poverty line (1997) | 10% | |
| Labout force (2003) | 1.871m | |
| Labout force by occupation (2002) | services (64%), industry (29%), agriculture (8%) | |
| Unemployment rate (2003) | 4.7% | |
| Main Industries | food products, brewing, textiles, clothing, chemicals, pharmaceuticals, machinery, transportation equipment, glass and crystal, software | |
| Trading Partners | ||
| Imports (2003) | $57.54bn | |
| Main Partners (2003) | UK 34.9%, USA 15.8%, Germany 7.9%, France 5%, Netherlands 4.1% | |
| Exports (2003) | $93.31bn | |
| Main Partners (2003) | USA 20.5%, UK 18.1%, Belgium 12.6%, Germany 8.3%, France 6.1%, Netherlands 5.1%, Italy 4.6% | |
| Public Finances | ||
| Public Debt | $36bn (31.2% of GDP) | |
| External Debt (1998) | $11bn | |
| Revenues (2003) | $53.22bn | |
| Expenses (2003) | $53.5bn | |
| Economic Aid (2001) | $287m | |
Overview
The Republic of Ireland is a small, modern, trade-dependent economy with growth averaging a robust 10% in 1995-2000. Agriculture, once the most important sector, is now dwarfed by industry, which accounts for 38% of GDP, about 80% of exports, and employs 28% of the labour force. Although exports remain the primary engine for Ireland's robust growth, the economy is also benefiting from a rise in consumer spending and recovery in both construction and business investment.
Over the past decade, the Irish government has implemented a series of national economic programs designed to curb inflation, ease tax burdens, reduce government spending as a percentage of GDP, increase labour force skills, and promote foreign investment. Ireland joined in launching the euro currency system in January 1999 along with 11 other EU nations. This period of high economic growth led many to call Ireland the Celtic Tiger. The economy felt the impact of the global economic slowdown in 2001, particularly in the high-tech export sector – the growth rate in that area was cut by nearly half. GDP growth continued to be relatively robust, with a rate of about 6% in 2001 and 2002 – but this was expected to fall to around 2% in 2003. Since 2001, GNP growth has been much worse, with an almost three-fold decrease in 2001 from the previous year. After a near stagnant year in 2002, growth was expected to pick up in 2003. [2]
Infastructure
Main Articles dealing with Irish infastructure: Transportation in Ireland, Rail transport in Ireland, Roads in Ireland, Communications in Ireland, Education in the Republic of Ireland
Ireland's transport infastructure ranges substantially in quality. On the East coast, the country is served by a modern road network which includes a north-south moterway, various by-passes and several dual carriage ways. The rest of the country however is still served by a relatively poor standard of road. The nationwide road network is currently being upgraded and improved by the National Development Plan. Ireland's rail network is run by the semistate body CIE and is made up of 9 national lines and several regional commutor lines such as the DART. CIE offer a freight service which links to the main ports. The efficency of the train network is poor, with regular delays and overcrowding on major routes. The Dublin area is served by a light rail network - the LUAS,a major tunnel the Dublin Port Tunnel which links the M50 to Dublin Port, and the DART. The country has a total of 36 airports and airfiels, of which 4 - Dublin Airport, Shannon International Airport, Cork International Airport and Belfast International Airport are of a substantial size. The country is served by several airlines, most notably Aer Lingus, Ryanair, Aer Arann, and Cityjet. Air transport is relatively cheap. The main ports are Rosslare Europort, Limerick, Dublin and Cork. The telecommunications network is rapidly improving, admitedly from a low base. Broadband is available to 90% of homes and businesses - however it remains relatively expensive. The mobile market has three providers - O2 Ireland, Meteor Ltd and Vodafone Ireland, whilst the landline market is dominated by the incumbent, Eircom. The electricity transmission system is run by the ESB and is available nationwide. The gas network is currently being expanded.
Resources
History
Main Articles: Colonial economy of Ireland (pre-1900), Early 20th Century Economy of Ireland (1900's-1950's), Lemass Era (1960's), Haughey Era (1980's), Celtic Tiger (1990's-Present)
The Economy of Ireland has changed significantly over the course of its history. In the colonial times under British rule, the economy was predominantly one based on Subsistence farming; mainly in potatoes and other types of tillage. In 1848, the overdependance on potatoes lead to the Irish potato famine, where the entire crop was wiped out by potato fungus. For much of colonial times the Irish economy existed solely to provide cheap raw materials to the far more industrialised British economy such as timber, beef, vegtables and marble. For much of the 1800's, the only factories in Ireland were the cotton mills of Northern Ireland, the Guinness brewery in Dublin and the Jacobs biscuit factory also in Dublin.
In the first half of the 20th century the economy changed dramatically. Farming became orinated around pasture rather than tillage. The country gradually was electrified and new factories were encouraged (such as the Carlow Suger Factory in Carlow). After Irish Independence, the Irish economy struggled against Britian and a trade dispute followed. Ireland put tariffs on British consumer goods, whilst Britian imposed tariffs on Irish beef. For a period, the country pursusd a protectionist policy and sought self-sufficency. In the 1960's the economy boomed. Under the leadership of Sean Lemass, many rehousing schemes were started to clear the Dublin tenements, the IDA was founded and foriegn investment was encouraged. However this boom did not last for long. By the 1980's Ireland was refered to as the Sickman of Europe and was far behind its European rivals. The government led by the now discraced Charles Haughey presided over a decade of high emigration, unemployment (about 18% for much of the decade) and economic mismanagement. In the 1990's, Irelands economic miracle occured. The Celtic Tiger resulting from a high FDI rate, a low corperate tax rate, and good economic management transformed the Irish economy. By 2000 it had become one of Europes wealtiest nations, unemployment was only 4% and income tax was almost half 1980's levels.
Economic Makeup
The Irish economy's secondary and tertiary sectors are of a similer size in fiscal terms however in terms of labour, the tertiary sector is far larger. Similerly in fiscial terms the primary sector appears small, however it still employs about 8% of the workforce.
Primary Sector
The primary sector consitutes 5% of Irish GDP, and 8% of Irish employment. It is largely made up of cattle grazing, dairy production, fishing and tillage farming; particularly of strawberries, suger beet, potatoes and turnips. Forestry has become a sizeable part of the Irish Economy under the incentivisation of state body Coillte. Zinc and Lead are mined in County Meath by Tara Mines. Quarrying is generally only for the internal market. In recent years, natural gas exploriation has become a significant contributor to the economy - there is gas off the south of County Cork and to the West of County Mayo. Peat exploitation in the midlands provided large employment and a valuable contribution to the energy needs of the country for much of the 20th century, however its signifcance has dwindled in recent years. Other natural resources include Gold deposits in the Wicklow Mountains, which however are presently unexploitable due to commercial unviablity.
Secondary Sector
The secondary sector consitutes 46% of Irish GDP - but only 29% of the labour force. Dominated for many years by textile companies like Fruit of the Loom, the sector is now made up of high-tech multi-nationals such as Dell, Intel, Pfizer and IBM. The secondary sector in Ireland manufactures products such as computers (25% of Europes computers are made in Ireland), computer parts (Intel processers are made in Ireland), drugs (much of Europes supply of Viagra is made in [[County Cork), confectionery, beer, high quality glass and crystal, software and machinery. The sector faces increasing competition from cheaper Eastern European countries such as Poland and many Asian countries such as China.
Tertiary Sector
The tertiary sector consitutes 49% of Irish GDP and 64% of Irish employment. The tertiary sector is by far the largest driver of mordern Irish economic growth. It is madeup of several industries such as accountancy, legal, call centers, finance, catering, and tourism. Many US firms locate their European customer service operations in Ireland due to the availablity of a young, well educated, English specking workforce. The Irish tourism industry attracts over 5m visiters annually and employees over 100,000. The IFSC in Dublin created some 14,000 jobs in the 1990's, all in the high-value finance and legal sectors.
State Intervention
->(Relatively free enterprise....)<-
State Ownership
Taxation/Grants
The Welfare State
Economic Ties
United States
In 1999, trade between Ireland and the United States was worth around $18.5 billion, a 24% increase over 1998. U.S. exports to Ireland were valued at $7.72 billion, an increase of about 8% over 1998 and 16% of Ireland's total imports. The range of U.S. products includes electrical components, computers and peripherals, drugs and pharmaceuticals, electrical equipment, and livestock feed. Irish exports to the United States grew by almost 32% over 1998 to $10.8 billion in 1999, representing about 15.5% of all Irish exports. Exports to the United States include alcoholic beverages, chemicals and related products, electronic data processing equipment, electrical machinery, textiles and clothing, and glassware.
In 1999, the recent trend of a U.S. trade deficit with Ireland continued. Overall, the value of U.S. imports from Ireland exceeded the value of U.S. exports to Ireland by $3.3 billion. Nonetheless, given the continued favorable outlook for the Irish economy, sales opportunities for U.S. producers in Ireland are expected to improve. Export-Import Bank financing and the presence of major U.S. banks in Ireland facilitate marketing by U.S. suppliers.
President Clinton and Irish Government officials have noted the important contribution toward economic and social progress American industrial investment in Ireland—north and south—has made. President Clinton has pledged to maintain the U.S. commitment to facilitate the growth of such job-creating investment. The International Fund for Ireland, which is funded by the U.S. Congress, has contributed $5 million annually to Ireland to support cross-border initiatives.
U.S. investment has been particularly important to the growth and modernization of Irish industry over the past 25 years, providing new technology, export capabilities, and employment opportunities. The stock of U.S. investment in Ireland at end-1998 was valued at $16.1 billion. Currently, there are more than 580 U.S. subsidiaries, employing almost 86,000 people and spanning activities from manufacturing of high-tech electronics, computer products, medical supplies, and pharmaceuticals to retailing, banking and finance, and other services.
Many U.S. businesses find Ireland an attractive ___location to manufacture for the EU market, since it is inside the EU customs area. Government policies are generally formulated to facilitate trade and inward direct investment. The availability of an educated, well-trained, English-speaking work force and relatively moderate wage costs have been important factors. Ireland offers good long-term growth prospects for U.S. companies under an innovative financial incentive program, including capital grants and favorable tax treatment, such as a low corporation income tax rate for manufacturing firms and certain financial services firms.
EU
Other Statistics
Household income or consumption by percentage share:
lowest 10%:
2%
highest 10%:
27.3% (1997)
Agriculture - products: turnips, barley, potatoes, sugar beets, wheat; beef, dairy products
Industrial production growth rate: 6.7% (2003 est.)
Electricity - production: 23.53 billion kWh (2001)
Electricity - production by source:
fossil fuel:
94.12%
hydro:
4.63%
nuclear:
0%
other:
1.25% (1998)
Electricity - consumption: 21.63 billion kWh (2001)
Electricity - exports: 285 million kWh (2001)
Electricity - imports: 38 million kWh (2001)
Oil - consumption: 174,400 bbl/day (2001 est.)
Natural gas - production 815 million cu m (2001 est.)
Natural gas - consumption 4.199 billion cu m (2001 est.)
Natural gas - proved reserves 9.911 billion cu m (1 January 2002)
Reserves of foreign exchange & gold $4.152 billion (2003)
Exchange rates:
Irish pounds per US$1 - 0.9865 (January 2000), 0.9374 (1999), 0.7014 (1998), 0.6588 (1997), 0.6248 (1996), 0.6235 (1995)
note:
on 1 January 1999, the European Union introduced a common currency the euro, which is now being used at a fixed rate of 0.787564 Irish pounds per euro; the euro has replaced the pound in many financial and business transactions; it has replaced the local currency in consenting countries for all transactions in 2002