The export factor
Another press release reaches us from the Department of Enterprise, Trade and Innovation. Is it just the thing to brighten up our afternoons? According to Minister of State for Trade and Commerce Billy Kelleher, “Ireland’s enterprise economy is now in a strong growth trend”, with figures (from the CSO) showing a 4 per cent year-on-year rise in exports in September. “The recovery in our economy over recent months has been maintained,” Kelleher declares.
IMF? Here? Someone should have said, we could have given the place a bit of a dust and got some fancy biscuits in.
The figures show that “the Government’s strategy in investing in an export-led economic recovery is the right one”, continues Kelleher, taking the credit. Maybe Frank Ryan, Enterprise Ireland’s chief executive, is right when he says Ireland will be the “comeback kid” of western economies – although that was, admittedly, a few weeks ago, and a few weeks, as the saying goes, is a long time in nationally humiliating sovereign debt crises.
Now for some more export-related analysis. New research from PMCA Economic Consulting crunches the numbers on a “statistically stable, long run and meaningful relationship” between export performance and the creation of new employment. Based on the period from 1997 to 2010, a 10 per cent increase in the value of exports from Ireland is associated with a 4.1 per cent increase in employment, or potentially 76,000-plus new jobs, says PMCA’s Pat McCloughan. Good news, especially as “economists have traditionally tended to view exports as having a limited impact on job creation”, he adds.
However, exports are only any use if we have someone at the other end who’s prepared to pay for the stuff. Here, the mood darkens. “The effects of deficit cuts are likely to be even more painful if they occur simultaneously across many countries,” says McCloughan. “This is precisely the international environment in which Ireland currently finds itself.”