The National Competitiveness Council, or NCC, is an organization that collects, analyzes, and reports data and statistics about the Irish government. In general, it focuses on comparisons of the growth and sustainability across the European Union. This organization has looked into the sustainability of economic health across a multitude of different scenarios.
As of late, this organization has noted that the Irish economy is becoming too dependent on a small number of domestic firms that fall within similar sectors of the business market. Although it is always a positive to support your home companies, there are some major issues that may come from this increased reliance.
To begin, Ireland’s economic dependence has been primarily within the goods and services export sectors. There has been a huge focus on pharmaceutical and chemicals being exported, with around 58pc of total exports in 2018 being in this sector; in 2017 it was at 45pc. Computer services are also dominating the market, making up 43pc in 2018, which was 3pc lower than in 2017. These bulk exports make up a huge part of the Irish total income and if something were to happen to the market there would be extreme governmental and personal economic downturns.
Additionally, some of the main issues with this domestic reliance is that there can be a stagnation of growth that can be sparked by any type of economic change. Especially with Brexit on the horizon, companies are slowing down or treading lightly economically in order to avoid being hard hit by this change in the EU. The government funded National Development Plan is attempting to create precautionary measures that would help increase Ireland’s current quality of infrastructure.
Another issue that Ireland is bound to experience is far out of the countries direct control. Because of the nature of the economy, small and open, it is highly susceptible to economic fluctuations that are a result of other countries decisions. For example, the US trade and taxation policy and Brexit are bound to affect Ireland more heavily than most of the other countries in the EU.
Overall, Ireland’s rank as 7th most competitive country in the world has a lot to prove within the upcoming months. With so many changes that are bound to occur in 2019, it is possibly that the country will have met a fierce competitor. Staying afloat will be hard but surely not impossible for this economy filled with determined people and businesses leading the way.