Ireland facing ‘lost decade’, says economist Stiglitz

Ireland is facing a lost decade as a result of the troika bailout, Nobel prize-winner Joseph Stiglitz said, as the country neared the end of its bailout programme.

Speaking on RTÉ Radio 1 yesterday, Mr Stiglitz said it was a "deep mistake" to bail out the bondholders. He said he was "astonished" at how Irish people accepted the situation without protest.

“A good share of the blame has to go to the ECB and [European] Commission for not restructuring the debts,” Mr Stiglitz said.

He said the ECB and others wanted to save the banks, "so it was a trade- off between banks all over Europe and the Irish citizens".He predicted a "lost decade" for the Irish economy before it got back on its feet, and the country would be unlikely to get back on the growth path it was previously on.

“Will you get back to where you were with maybe a lost decade? Yes, I think you will. But it will be a lost decade, at least.”

Austerity “essentially never worked” he said, adding that the decision to stay in the euro was probably the right one.

His comments came as the troika said Ireland’s programme remains “on track in the context of the nascent economic recovery”.