It's always darkest before the dawn

In recent weeks contrasts within the Irish economy have continued to emerge. At a glance you could surmise that we continue to be amongst the basket-cases of Europe. Gloomy growth forecasts from trusted sources such as the ESRI predict the economy will grow by 0.9% next year, a downgrade from a previous prediction of 2.3%.

The unemployment rate refuses to abate. In fact the media is getting so tired of the figures they are becoming more creative. Recent reports claimed the number of women out of work for more than a year has soared by a fifth. Official figures show overall unemployment remains at 14.2% in February. We have seen record numbers attend emigration jobs fares such as the Working Abroad Expo across Ireland. Moody’s predict Ireland will face tough challenges regaining market access in 2013 - which might well lead to yet another trip to the Troika. The European crisis roars on and although early media indications suggest a yes vote, the implications of a failure to ratify the upcoming referendum on the Fiscal Treaty suggests a rather worrying few years for our economic prosperity.

With all of this in mind, I think of a line from Florence and the Machines’ song “Shake it out” - It's always darkest before the dawn. We’re bombarded with the depressing news headlines listed above but I get a sense of contradiction when you consider the following recent headline stories. Abbott invests €85 million to expand Irish plant, Allergan invests €350 million, Sanofi unveils €150 million to expand Irish plant, Merck opens €100 million R&D Centre, Pfizer to spend €200 million and so on and so on. Now, consider that this is just in one sector which confirms Ireland as the world's biggest net exporter of pharmaceuticals. We can also look at other stand out sectors in terms of current output and future expectations. The funds industry for example – now employing over 11,000 people in the administration of €1.8 trillion of assets. PepsiCo, Lilly, Microsoft and Paypal are all more amazing stories of 2012, which is just over two months old!

And the best news is that it’s not just the capital reaping the benefits - Sligo, Cork, Westport, Waterford, Carlow and Dundalk are the locations welcoming this major investment, which will also lead to knock-on jobs throughout their local communities. In my neck of the woods, Galway and Limerick are seeing the fruits of a strong multinational market, coupled with inward investment and commitment by large organisations to the region. Galway is now firmly established as the medical devices capital of Ireland, with companies like Medtronics and Boston Scientific acting as the pillar to many other organisations in the same sector. They take full advantage of the availability of skilled labour in a range of technical areas including R&D, design and manufacturing. Limerick and the mid-west is probably best served from the financial services sector which includes of course, the funds industry. Northern Trust continues to expand in the region and GE has an ever-growing presence as well as a substantial aircraft leasing industry in the Shannon Free Zone.

There are many challenges ahead, of that there is no doubt. But we cannot control the European issue and it’s too late to ‘un-guarantee’ the banks. While these and related issues are not going to go away anytime soon we should focus our attention on the positives and the potential it brings - the aggressive investments, the government focus on entrepreneurialism and the solid industry infrastructure that is now emerging across the country. If we all keep our focus on that, the dawn must surely be very close by.

Bobby O'Connor
Business Director
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