State economy|While many other EU countries are currently struggling with their bloated deficits, Ireland’s economy is humming along with a surplus.
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Ireland has a surplus of 8.6 billion euros, the use of which should be decided by the government.
The economic crisis Ireland experienced in the early 2010s is still visible in Ireland’s economic policy. The country’s government is still quite cautious in its use of money.
According to economists, Ireland should make public investments now, when the country can finally afford them.
Major some of the EU member states are currently considering how they would avoid falling into the excessive deficit procedure initiated by the European Commission.
You fall into the so-called “economic monitoring category” if the deficit of the public finances is more than three percent in relation to the gross domestic product.
However, Ireland is an exception among EU countries. While many other EU countries – including Finland – are struggling with their deficits, Ireland’s economy is booming with a surplus. It also grew five times faster than expected last year.
Economic magazine of the Financial Times According to (FT), Ireland is facing a “luxury problem”. The officials preparing the national budget would have to figure out how Ireland could use its 8.6 billion euro surplus.
In practice, therefore, in Ireland, the distribution fund of the public finances is being discussed.
“Ireland’s problem is not that the country doesn’t have enough money – it has too much,” says the chief economist of Ibec, an Irish business advocacy organization. Gerard Brady for FT.
“The problem is that Ireland should now figure out how to use the money for the benefit of its citizens.”
Over ten years ago, Ireland fared considerably worse.
The financial crisis that started in the United States in 2008 drove the country’s economy into a slump for years. The Irish government then made the biggest mistake in the country’s economic history by trying to guarantee the liabilities of Irish banks. However, the banks’ credit losses grew so large with the crisis that the government’s money was not enough to support the banks.
In 2010, the EU and the International Monetary Fund (IMF) had to draw up a rescue package of tens of billions of euros for Ireland. At the same time, the country had to commit to the economic discipline program dictated by them.
According to the FT, the economic crisis of a decade ago is still visible in Ireland’s economic policy. The country’s government is still quite cautious in its use of money.
However, the economists interviewed by Talouslehti believe that the government would now have a good reason to deviate from the austerity line. In their opinion, Ireland should make public investments when the country can finally afford them.
“There is a huge need for public investments, and the state should take advantage of the opportunity now that it has been offered one,” says the economist David McWilliams for FT.
in Ireland as such, there should be no shortage of investment sites where it could sow public money.
The country not only has a shortage of apartments, but also considerable repair needs in the water supply and electricity network, as well as in public transport and health care.
At the same time, almost two-thirds of Irish people suffer from anxiety or depression, and one in seven children in Ireland lives below the poverty line.
Correction on September 2 at 3:41 p.m.: The rescue package drawn up for Ireland was worth tens of billions of euros, not tens of millions of euros.
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