Rural Ireland will be disproportionately affected by continuing job losses in manufacturing and agriculture because of unbalanced regional development policies, a top economist has said.
In the report compiled for the Agri Aware organisation, which promotes the sector, Jim Power of Friends First says rural areas are still not seeing the sort of infrastructural investment necessary to generate economic activity.
"Rural Ireland is still not a focus of policies aimed at innovation and economic dynamism," he said in the report, The Importance of the Agri-Food Sector in the Future Development of the Irish Economy.
"With further manufacturing job losses likely over the medium to long term and with job losses set to continue in agriculture, rural Ireland will be disproportionately affected.
"Policymakers cannot stand idly by and allow rural Ireland to become more economically depressed. From an economic and social perspective, this is not a desirable outcome.
"Policy needs to become much more focused on rural development and a clear Government strategy towards rural development is essential," said his report.
Mr Power also highlighted the marked regional imbalances in economic growth. CSO figures showed disposable income was 10 per cent below the national average in the southeast and 8 per cent below the national average in the Border, midlands and western counties. Disposable income in Dublin was 13 per cent above the national average.
"The National Spatial Strategy has not succeeded in achieving the objective of more balanced regional development. Rural economies are still being denuded of young people, economic activity and economic and social vibrancy," he said.
"The continuing slowdown in foreign direct investment and the dramatic slowdown in recent years in merchandise exports further highlight the importance of giving priority to our indigenous industries."
Stressing the importance of the agriculture and food sector in the economy, Mr Power said that in spite of the massive growth in employment in other sectors of the economy, the agri-food sector, both directly and indirectly, employed some 230,000 people in production, processing, marketing and services, accounting for 11 per cent of total employment.
"More importantly, the agri-food sector contributes twice as much in value added to the economy as other manufacturing areas," the report said. "For every €100 of output generated by the agri-food sector, €75 is spent on Irish raw materials, labour and services. The comparable figure for other areas of manufacturing is just €38."
On food price inflation, the report said that from January to October 2007, the price of bread in Ireland increased by 17.3 per cent, milk by 16.4 per cent, butter by 16.4 per cent and eggs by 7.9 per cent. He predicted that these increases would continue to be well above the rate of inflation driven by a combination of poor climate patterns and increased use of corn and other food items for bio-fuels.
"Government policy needs to become more focused on rural economic development and the agri-food industry should be given much greater priority in an economy that is undergoing a significant transformation at the moment," he said.
"The agri-food industry should be recognised as an innovative and high value added industry."