Implementation

Building Ireland’s Smart Economy: A Framework for Sustainable Economic Renewal, was produced in December 2008 setting out the Government’s medium-term strategy for economic recovery.  It responds to a serious economic crisis whereby Ireland has been hit hard by the combined fallout from the correction in the residential construction sector, the international economic downturn, and unfavourable currency movements.  The economy has contracted by more than 10 percent, and unemployment has risen above the EU average.

As well as short-term stabilisation measures, the strategy underpins economy-wide improvements in productivity and performance through better use of knowledge—now the key resource in today’s advanced economies.  This includes addressing new challenges in conserving natural resources, protecting the environment, and planning sensibly for longer life expectancies, while restoring stability to the public finances.

There are 5 Key Action areas:

1.         Securing the Enterprise Economy and Restoring Competitiveness 

2.         Building the Ideas Economy—Creating ‘The Innovation Island’ 

3.         Enhancing the Environment and Securing Energy Supplies 

4.         Investing in Critical Infrastructure 

5.         Efficient and Effective Public Services and Smart Regulation.

Decisive action since the crisis broke has seen a stabilisation of the public finances as set out in Budget 2010.  The economy is now expected to see a return to growth in the second half of 2010, and to net employment creation in 2011.

Despite the severity of the recession, key strengths of the past two decades remain.  Economic activity as measured by GDP will be around 30 percent higher in 2010 than in 2000, and about 150 percent higher than in 1990.  Numbers in employment this year will still be around 1.9 million, compared with 1.7 million in 2000, and 1.2 million in 1990.

The economy continues to enjoy favourable demographics, a highly educated workforce, and resilient export performance—as well as the significant benefit of the investment of the last decade in modernising physical infrastructure and developing world-class research capacity.

Strategic objectives to be delivered during 2010 include:

• delivering budget deficit stabilisation and identifying further fiscal consolidation measures for 2011
• restructuring and recapitalising the banking system to ensuring it re-focuses on the flow of credit to business
• providing 160,000 training and work experience places for people who have lost their jobs
• investing €6.4bn in our capital programme
• completing the inter-urban routes between Dublin and the main regional cities
• introducing new measures to strengthen commercialisation of publicly funded research
• delivering energy-efficiency upgrades in 60,000 homes
• marketing drive to increase tourism numbers and revenue by 3%.

The Cabinet Committee on Economic Renewal will continue to oversee implementation of the Smart Economy agenda of restructuring and reform across all sectors of the economy.  This will include regular reports from relevant Ministers on progress, and a particular emphasis on bringing cohesion to the interlocking policies and actions necessary to support sustainable economic renewal.

Progress report covering period to March 2010 available here.