Forfás chief outlines four steps to economic recovery
A nationwide focus on enterprise is critical to the success of the Irish economy but challenges in the local economy in terms of costs, access to credit, innovation and productivity must be dealt with, Forfás CEO Martin Shanahan said today.
“Increasing business investment and competitiveness is not just a necessity for enterprise recovery, but critical for the success of the entire economy,” Shanahan said at the launch of the policy advisory board's annual report.
According to Forfás, driving growth and jobs will be reliant on four critical success factors:
1. Relentlessly pursuing cost competitiveness
“Recent gains in cost competitiveness due to weaker demand and the recession are not yet sufficient to regain international market share.”
2. Growing productivity
“At this time of constrained resources, any expenditure must support competitiveness gains through enhancing productivity. At the national level, we need to focus on increasing efficiency and productivity through targeted investments in education and skills to meet future enterprise needs, accelerated investment in next-generation broadband, ICTs and removing blockages in physical infrastructures that are constraining enterprise development and competitiveness, such as roads and water services.”
“We need to sustain recent improvements in business R&D and innovation and ensure effective transfer of ideas, knowledge and skills from our public research to enterprise to underpin success in markets.”
4. A sustainable enterprise mix of competitive sectors and markets
“Ireland has a range of enterprise strengths as demonstrated by their resilience and adaptability during the recession. For the future, we need to support the development of a diverse enterprise profile, building on our strengths in manufacturing and internationally trading services business, in modern and more mature sectors, from agri-food to medical devices and funds management, to new and high-growth areas, such as video games, clean tech and education services.”
Shanahan said exports have the greatest potential to fuel the economy’s return to growth.
“It is through export trade that we can pay our way in the world. Policies must take consideration of all enterprises as domestically trading enterprises are critical to the success of our exporters.
“Recovery in both will be required to address the unemployment challenge,” he said.