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While facing serious challenges - especially from the property
downturn - the Irish economy is well placed to maintain strong
growth, the OECD's Economic Survey of Ireland has stated.
'Strong economic activity has been maintained and economic
fundamentals remain sound' - it said. The end of the long
housing expansion will, however, slow growth and presents
more difficult challenges than in recent years, it added.
In the short-run, the economy must adjust to lower housing
activity and the risks the slowdown creates. 'In the long-term,
maintaining high rates of productivity growth is the key challenge.
It is important that Ireland remains internationally competitive'
- the OECD assessment reported.
Policy can support productivity growth through achieving
stronger competition, improved infrastructure, more innovation,
increased human capital and higher labour market participation.
Ireland should ensure the stability and sustainability of
its economic and social gains.
A more efficient housing market would contribute to greater
stability and the recent international financial market turmoil
highlights the need to continue to prepare for financial upsets.
The assessment added that maintaining a prudent fiscal policy
as revenue growth slows will help to promote stability - although
this will require more effort to improve efficiency if services
are to be improved. With regard to the pension system, ageing
will eventually pose significant challenges that can be reduced
if preparatory action is taken now.
Successful long-term integration will help to ensure that
immigration is a success, the OECD report said.
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