The government should address the country’s housing and infrastructure deficits as a priority, according to Ireland’s business leaders.
New research shows the chief executives of Irish companies consider infrastructural shortfalls to be the main area of economic concern while they also believe that the country’s competitiveness must be safeguarded in order to attract overseas investment.
House prices have risen by 8.6 per cent in the past 12 months due to a lack of homes being built. This, in turn, has given rise to concern among business leaders that the housing shortage could curb their ability to expand and attract new workers.
The National Competitiveness Council also flagged up rising house prices as a concern late last year and warned that inflation in the sector could erode Ireland’s competitiveness.
The PwC Global CEO survey found that Irish business leaders are generally upbeat in their assessment of Ireland’s economy and their own business prospects. Based on the survey, PwC forecasts that the country’s economy will grow by 3.3 per cent this year.
Advertisement
However, confidence has waned somewhat in the past 12 months as a result of the UK’s Brexit vote and the election of Donald Trump as US president.
Ciarán Kelly, the head of PwC Ireland’s advisory business, said that the feedback from Irish business leaders was somewhat of an outlier when compared with the results of the survey internationally. “Irish CEOs are looking to manage their businesses in an increasingly volatile external environment and clearly the performance of our trading partners is important,” he said. “Contrary to global CEOs, based on our Irish surveys and what clients are telling us, Irish business leaders are more cautious about the outlook for the year ahead compared to this time last year.
“However, they remain positive about growth opportunities while tackling the business disrupters. Brexit looms large and, along with a new landscape leaders in the US, a changing tax agenda and other geopolitical uncertainties, will no doubt influence a period of change.”
More than half of Irish CEOs are confident about future growth prospects but a third remain apprehensive. About three-quarters expect revenue growth in 2017, down from 88 per cent a year ago, while 52 per cent expect to increase staff numbers compared with two thirds the last time the survey was conducted.
Nearly 75 per cent expect Brexit to be negative for Ireland compared with 17 per cent who consider it to be a positive.
Advertisement
The election of Mr Trump has heightened fears about protectionism in the US but Irish CEOs feel Ireland will continue to attract foreign direct investment as long as the country’s competitiveness is protected.