Dáil Éireann Debate, Thursday - 15 November 2012
100. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which the economic fundamentals are becoming more positive by way of reference to the past three years to date; and if he will make a statement on the matter. [50802/12]
View answerSupport for overall activity is coming from the exporting sectors, with services exports becoming an increasingly important engine of growth in recent quarters. This, in no small part, reflects the improvements in price and cost competitiveness that have been evident since the onset of the crisis. Such internal price adjustments are crucial for Ireland’s recovery, given that Ireland’s membership of the euro area eliminates the option of currency devaluation. The European Commission recently forecast that our nominal unit labour costs will have fallen by a cumulative 16 percentage points in the period 2009-2014 compared with an increase of 8 percentage points for the euro area as a whole. Furthermore, from a macro-economic perspective an important measure of competitiveness is the real harmonised competitiveness indicator (HCI). This reflects relative consumer prices trends, together with weighted exchange rates. Since mid-2008, the real HCI has fallen by 21 percentage points, indicating an improvement in our international competitiveness.
So many of the necessary improvements are taking place, and this will support economic growth into the future.
