Economic recovery must equally benefit the west

By Joe Gilmore of IBEC

The economy is recovering much faster than many expected. When the EU Commission recently forecast that Ireland would be the strongest growing European economy in 2014 and for the next two years, many international observers were surprised.

Ireland is on the way back, but not all parts of the country are benefitting. For many around the country, impressive economic statistics have not translated into real life improvements. Recent figures released by the Central Statistics Office highlight the disparity in disposable income between the capital and those in rest of the country.

At € 18,264 the average disposable income in Galway is 20% less than in Dublin and more than thousand euros a year below the national average.

The recovery has firmly taken hold in Dublin. Traffic counts have already exceeded their pre-crisis levels; a housing shortage has emerged; retail and hospitality is doing much better and even construction is bouncing back.

All of this is driven by strong job creation. Dublin remains a location of choice for high-end technology and other services jobs. Over half of all the new jobs announced since the start of last year were in the capital.

Although unemployment is falling, at 10.2% in the west it’s still too high especially when compared to unemployment of 8.6% in Dublin. We need an urgent debate on how best to ensure all parts of the country feel the benefits.

We know from previous recessions that there is always a lag between a recovery in Dublin and the rest of the country. This time it seems that the lag is much longer. More worryingly, we can’t be sure that prosperity will actually flow from the main cities to elsewhere.

The future economic fate of Ireland’s regional and rural areas can’t be left to chance. It must be planned for and invested in.

So what can be done? Firstly, we need ambition. Government, business and society in general can rebuild a prosperous regional and rural economy. We should aim high.

Ireland will have by far the strongest growing population of any EU country over the coming decades. A return to net immigration and continued high birth rates can help revitalise every county in Ireland. Urban growth does not need to come at the expense of rural areas.

Secondly, government must have a detailed plan to support balanced regional development. Previous attempts at a national spatial strategy failed because the political system refused to make the difficult decisions on the prioritisation of limited resources.

Local politics trumped proper regional planning when it came to the tough decisions. With the next general election at most a year away, we cannot afford to let this happen again.

We urgently need a new strategy that sets out a blueprint for a better balance of social, economic and infrastructure development across the entire country. It must be supported by more effective and integrated planning.

A relatively small number of strategically located growth centres must be identified, which can in turn attract economic activity to their neighbouring towns and rural catchment areas.

For more, read this week’s Connacht Tribune.