Patrick LENAIN, OECD

patrick.lenain@oecd.org

IBEC CEO CONFERENCE

DUBLIN, FEBRUARY 2014

STRONG AND INCLUSIVEGROWTH IN IRELAND

1. Ireland is back on its feet

2. Innovation & entrepreneurship key to prosperity

3. Business case for inclusive growth

2

MAIN MESSAGES

IRELAND IS BACK

ON ITS FEET

3

4

IRISH CONSUMER CONFIDENCE IS UP(monthly ESRI & KBC index)

5

IRISH JOB CREATION IS POSITIVE(in ‘000s of jobs)

6

SUCCESSFUL RETURN TO FINANCIAL MARKETS

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IRISH RECOVERY: GROWTH IS UNDERWAY

0% in 2013

1.9% in 2014

Source: OECD Economic Outlook 94, November 2013http://dx.doi.org/10.1787/eco_outlook-v2013-2-en

8

STRONG GROWTH IS NEEDED(GDP, billion €, constant 2010 prices, seasonally adjusted)

100

120

140

160

180

200

220

100

120

140

160

180

200

220

Non-linear trend 1960-2005

Actual GDP

INNOVATION AND

ENTREPRENEURSHIP

KEY TO

PROSPERITY

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10

IRELAND ATTRACTIVE TO INNOVATORS

• Easy to do business

• Government support

• Talent pool

• Good research centres

• FDI friendly

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BUT LOW INTENSITY OF ENTREPRENEURSHIP

Birth rate of new businesses in %

Source: Eurostat, 2010

0

5

10

15

20

25

0

5

10

15

20

25

• Young firms (up to 5 years) make largest contributions to net job gains.

• Gazelles (successful start-ups) make large contributions to innovation.

• Successful clusters – Medical devices

– Pharmacy

– Computers

– Agri-food

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WHERE DO JOBS COME FROM?YOUNG FIRMS AND “GAZELLES”

IDEAS TO CONSIDER

1. Ease access to government support

2. Balance direct support and R&D tax credits

3. SME Financing remains a challenge

4. Broadband is key

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THE BUSINESS CASE FOR

INCLUSIVE GROWTH

14

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FIRST CHALLENGE:STILL TOO MANY UNEMPLOYED

0

5

10

15

20

25

30

Unemployment rates (%) in 2013

About 280000 jobseekers and 400000 on the live register

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SECOND CHALLENGE: HIGH HOUSEHOLD DEBT(debt-to-income ratio in %, 2012)

0

50

100

150

200

250

300

0

50

100

150

200

250

300

Source: Eurostat

• Avoid scarring effects

• Preserve employability

• Retain skilled workers

• Wellbeing associated with productivity

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THE BUSINESS CASE FOR INCLUSIVE GROWTH

IDEAS TO CONSIDER

1. Youth Guarantee

2. Skills for expanding sectors

3. Efficiency of labour-market schemes

4. Support social entrepreneurship

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SUMMARY

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• Multiple signs that the recovery is underway.

• Ease young firms’ and gazelle’s access to capital.

• Engage long-term job seekers and indebted families.

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TO SUMMARIZE

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THANK YOU!WWW.OECD.ORG/IRELAND