Anyone thinking of comparing Ireland to Germany should take a drive through the Ruhr region. Hundreds of kilometres of Industry. Or have a look at the skyscrapers of Frankfurt. Or the motor industries of Bochum, Stuttgart or Duesseldorf. Or the Media hubs of Hamburg and Cologne. Or check-out the low wages of East germany. Excuse me for not accepting Germany as a suitable comparison for Ireland. Never mind their military hardware, mag-lev trains and nuclear power tech exports. I would be thinking ‘Slovakia’ instead.
How can Ireland’s GNP be the same as perhaps the richest country in the world? It makes absolutely no sense whatsoever.
The answer to the question I think is that we are still in the middle of mass delusion and denial about the state of our country. Government spending is roughly where it was 4 years ago. Household indebtedness per capita in Ireland is astronomical compared to Germany. Our unemployment rate isn’t moving south any time soon. There have been only minor cuts to SW and none to the minimum wage or to PS pay. There have been no home repossessions. We do not have a single functioning indigenous bank. 90% of our exports are from MNC’s. Our sovereign and bank debt is so high we can’t borrow on the open market, will need a second bailout and will, at some point, have a credit event.
And yet somehow we are to believe that the underlying truth is that our GNP is the same a Germany’s?
Sorry, I can’t even get my head around how that can be possible. I always have an open mind to be persuaded otherwise, but my take is that we are living in a false parallel universe and the underlying truth has not yet been revealed.
GNP per capta is all the goods and service produced in the county +/- foreign transfers with the world . Are GNP per head happens to be the same as Germanys, sorry if you can’t get that Larry but its a fact. yes are government finances are in a heep but that is as you say above, were going to have to cut PS pay and SW to levels like Germanys to get are governments finances back on track, currently PS and SW are overall higher in Ireland than in germany.
Apples 60bn ipad ‘exports’ count towards GDP but I don’t know that a significant part of German GDP can be regarded as equivalent economic activity. Extract the offshore effect and Irish GDP would look more like Slovakia than Germany I suspect.
Last time I looked at the numbers a few years ago at the MNC transfer part of the economy account for around 70% of exports, 50% of private sector GDP and around 30% of total GNP. i.e shut down the blatant tax evasion by MNC’s and that is probably how much of the economy would disappear. Shutdown the equivalent German tax scams (Luxemburg, Netherland shell operations etc) and the German GNP would probably rise a few percent. German corporate profits however would collapse. But thats another story.
The only upside of the much larger financial and regulatory evasion facilitated by the IFSC is that even though it absolutely dwarfs the official economy, about 5 times larger, there is almost no leakage into the real economy. It generates relatively little domestic economic activity. The 600 billion p.a in the IFSC is just “resting” in a/c’s.
A much more relevant comparison imo would be Finland. Similar population size, GDP per capita ($37600 v $36500), dispersed population and developed public services.
Finland property running about €210 /sq.ft or €2261/sq. m. I don’t have the equivalent figure for Ireland but it seems to me that most properties for sale are closer to twice that at present.
Maybe in Dublin but I would be surprised if nationally the price per square foot was above €200
Jeysus we had 30 pages recently on why we are not in a dead cat bounce, and where the bottom of the cycle lay, when all we needed to show current prices are overcooked was in the 6 pages of this thread.
Of course you are correct.