The Irish economy is expected to grow by around 3.75 per cent during 2002, down from 5.9 in 2001, increasing to around 5 per cent in 2003, and both growth rates are at least twice EU average growth rates, PricewaterhouseCoopers‚ latest European Economic Outlook reveals.
The report says that an upturn in global demand should boost Irish export growth over the course of 2002 and provide the main driving force behind an expected gradual economic recovery. The principal downside risk to this scenario however would be a prolonged slump in the global technology sector, associated with the US recovery stalling later this year, and also the significant appreciation of the euro exchange rate, which could combine with strong wage inflation to severely impact Irish competitiveness relative to the UK and US.
Overall growth in the Euro zone is expected to average around 1.25 per cent in 2002 before recovering gradually to around 2.5 per cent in 2003, and Euroland inflation is likely to fall below 2 per cent by the end of 2002 according to the report. |
