Ireland can learn from Asia – Sunday Business Post

Two newly released reports  suggest that Ireland is slipping down global competitiveness rankings.

The World Bank Doing Business 2010 report came out last Wednesday, a day after the World Economic Forum (WEF) released a survey of economic competitiveness.

Ireland stays in the top ten in the bank’s report, which looked at ease of running a business in 183 countries, listing Singapore as the optimum location.

The Davos-based WEF does not have the World Bank’s standing, but its report takes a broader view of global economic competitiveness. It puts Ireland at number 25 of 133 countries surveyed, just below Malaysia. Switzerland displaced the US as the most competitive economy, with Singapore at number 3.

Singapore and Malaysia share some common factors with Ireland, as open economies that seek high-end foreign direct investment and court tourists. Singapore’s 4.5 mill ion population probably makes for a more valid comparison, though the city-state outranks Ireland in both reports.

While Ireland’s boom led to promises to improve infrastructure, Singapore, according to the WEF report, now ‘‘leads the world in the quality of its roads, ports and air transport facilities’’.

Unlike Ireland, Singapore and Malaysia expect growth to resume next year, despite being export-driven and somewhat dependent on US consumer spending.

Elsewhere in the region, politically unstable Thailand will recover slowly, but without needing the major work done on its economy during the 1997/98 financial crisis, when the International Monetary Fund moved in.

The ESRI projects that the Irish economy will contract by 9 per cent this year. In contrast, Citigroup expects the Malaysian economy to shrink by just 2.3per cent in 2009, while HSBC said there was an ‘‘outside chance’’ the Malaysian economy would resume growth this quarter.

Economists polled by the Monetary Authority of Singapore forecast a 3.6 per cent contract ion this year, much improved from forecasts of 6-7 per cent a few months ago. Singapore’s economy stopped contracting between March and June, and returned to growth, but the damage done in the first few months of the year is likely to outweigh any growth before the end of the year.

Taiwan and Thai land’s economies shrank at a slower pace due to hefty ‘stimulus’ programmes. These economies have also used interest rate changes to bolster recovery, an option Ireland does not have, as rates are set by the European Central Bank.

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