Search for:

Ireland has the most successful recovery in the Eurozone Periphery

Fitch ratings agency yesterday released a report which shows that a divergence has started to develop in the eurozone periphery as the economic recovery in the eurozone takes hold.

The report compares the recent macroeconomic performance of the four largest peripheral countries – Italy, Spain, Portugal and Ireland – with a focus on the divergence and its potential drivers.

It finds that Ireland is the most successful among the four peripheral countries and by most metrics an outlier. According to the report, the recovery and ultimately the growth potential was helped by the high level of openness of the Irish economy.

The report indicates that confidence in the financial sector was boosted by early bank recapitalisation, though the forbearance of NPLs prevailed for a longer period and fiscal consolidation has continued during the recovery.

For more on this article, please visit: Business World

Brexit will be the most significant risk for the Irish economy warns Premier Irish law firm

The possibility of a Brexit is probably currently the single most significant risk for the Irish economy and Irish business according to a report by Premier Irish law firm, McCann FitzGerald.

This report was launched at a special panel discussion which featured Chairman of AIB- Richard Pym, Group CEO of Ervia-Michael McNicholas, Former CEO of UK Office of Fair Trading and Chairman of Irish Competition Authority-Dr John Fingleton and Chief Economist at Goodbody Stockbrokers-Dermot O’Leary.

The event was moderated by John Cronin, a partner and former Chairman McCann FitzGerald, who leads the firm’s Brexit Group.

The briefing by McCann FitzGerald is the first of its kind by a major Irish law firm and provides analysis in relation to a number of different legal areas and industry sectors including energy, intellectual property, imports and exports and financial services.

In light of its warning, McCann FitzGerald recommends that Irish companies should establish a review team to consider their business models and arrangements in order to identify legal and business risks, opportunities and steps that should be taken in the event of a vote to leave.

The primary aim of the review would be to identify the principal aspects of the company’s business that would be most affected by Brexit.

Cronin noted that the financial services industry, including asset management and funds, is most exposed of all UK industry sectors to a Brexit.

In relation to Ireland, he said that there may be short and medium term gains for Irish financial services but the longer term position is uncertain and somewhat insecure. However, he suggested that there may be some Irish solutions to a number of potential issues that could arise for the UK investment funds industry.

Article Source: Business World

Irish jobs market shows consistency this quarter rather than growth

Morgan McKinley have today released their Irish Employment Monitor for the first quarter of 2016.

The Morgan McKinley Irish Employment Monitor measures the pulse of the Irish professional jobs market by tracking the number of new job vacancies and new candidates within the Republic of Ireland each month.

The monitor shows that the availability of professional job opportunities remains almost constant in the first quarter of 2016 compared to the same period last year.

The volume of professional job opportunities decreased by less than 1%, in the first quarter of 2016 (36,925) compared to the first quarter of 2015 (37,171).

The number of professionals seeking new roles increased by 4% this quarter (24,084)  compared to the same period in 2015 (23,140). IT, Engineering, Supply Chain and Multilingual are the most buoyant sectors to date this year.

The monitor shows the pharmaceutical, food and medical devices sectors continue to drive demand for engineering, procurement and production professionals. Talent shortages remain an issue across the IT sector with Javascript developers most in demand.

Hiring in the Funds sector remains static again this month reflecting global market uncertainty.

For more on this article, please visit: Business World

Ibec warn on Brexit risks for Irish business

The threat of the UK leaving the EU, along with other economic headwinds, means the Irish business environment will be less benign and increasingly uncertain over the coming months according to Ibec.

The group have today published their latest Quarterly Economic Outlook which predicts economic growth of 4.6% this year and 3.9% in 2017.

Ibec claim the exchange rate is the most immediate risk. They claim that in the aftermath of a possible Brexit the sterling/euro exchange rate is likely to move toward or above parity. This would leave Irish firms selling into the UK market 30% less competitive by June than they were in January through exchange rate movements alone.

Furthermore, they claim any new UK-EU arrangements may undermine free trade. An agreement they say would take at least two years, but is likely to take much longer. This would bring a level of uncertainty for Irish firms exporting to Britain in the short term impacting on employment, investment and export plans.

Ibec believe the risk to trade flows has been underestimated because of the very significant knock on impact that changing investment patterns could have on trade. They say Ireland’s  investment-friendly business model is particularly exposed.

The report also finds that there are potential opportunities for Ireland from a Brexit. UK-based corporates and financial sector firms will need a home within the European single market. Ibec believe Dublin may be in a prime position to benefit.

However, Ibec also believe Brexit would also mean that the UK would no longer be subject to state aid rules when competing for FDI or encouraging indigenous business. The UK government might introduce enhanced business and investment supports in order to prevent capital flight and attract FDI.

For more on this article, please visit: Business World

Ireland feeling the first Brexit chills as exporters pounded by slump in sterling

Ireland’s largest companies are beginning to feel the effect of Britain’s debate over whether to remain in the European Union, and it may be a taste of what’s to come for the rest of the nation.

Concern about the outcome of the UK referendum in June has helped push the pound down 10pc against the euro since November.

About 60pc of Irish companies selling goods overseas are already affected.

“Sterling has deteriorated and that’s tough for Irish exporters,” Richard Pym, the English-born chairman of AIB, said in an interview in Dublin this month.

“Upon Britain leaving EU, one would anticipate that sterling would come under pressure again.”

Brexit is probably the single biggest risk facing the economy, the fastest growing in the euro region.

The question is over the EU’s integrity, according to Guillermo Hermida of CaixaBank Asset Management in Madrid.

Cracks in the bloc would undermine investor confidence in its weakest members, the so-called peripheral nations, he said in an interview in the Spanish capital. That would include Ireland.

Permanent TSB, a bank that’s still trying to recover from Ireland’s financial crisis, said this month that concern about Britain’s membership in the EU is hampering its efforts to sell £2.4bn (€3bn) of UK loans. “Brexit risk has caused me to slow down the process because I think we’re on the wrong side of the line,” Jeremy Masding, the bank’s chief executive, told analysts. “I want to wait until I see what the result of the referendum is and then see how the markets react.”

Irish-listed Dalata Hotels, which operates in London, Manchester and Leeds as well as in Ireland, warned this month that the UK might generate less revenue as sterling slides.

Ryanair gets about 27pc of its sales from the UK and will be the biggest Irish loser along with drinks company C&C and agricultural products company Origin Enterprises, according to securities firm Investec.

“We don’t think it would have an immediate impact on our business,” Ryanair’s chief marketing officer, Kenny Jacobs, said in an interview with Bloomberg Television.

“In the medium and longer term, it would create some uncertainty if Britain were outside of Europe.”

It’s not all bad news for Ireland, with Dublin presenting an “obvious choice” for financial companies seeking to relocate following a UK exit from the EU, the NTMA said in a presentation last week.

“Estimates suggest some €6bn of FDI might be attracted to Ireland in the case of Brexit,” the debt office said. (Bloomberg)

Article Source: Irish Independent

72% of Private Company CEOs don’t expect the Global economy to improve in the next year

PwC have today released their 19th Annual Global CEO Survey in which 1,409 interviews were conducted in 83 countries during the last quarter of 2015.

By region, 476 interviews were conducted in Asia Pacific, 314 in Western Europe, 170 in Central and Eastern Europe, 169 in Latin America, 146 in North America, 87 in Africa and 47 in the Middle East.

Of these respondents, 848 (60%) were CEOs of privately-owned companies across 79 countries.

The research shows that a large majority (81%) of private company CEOs around the world believe that their company is likely to grow revenues over the next year.

Only 28% of private company CEOs expect the global economy to improve in the next 12 months – down around 10 points on last year. And 66% of private company CEOs believe there are more threats to their company’s growth now than three years ago – up from 58% last year.

Fifty eight per cent of public company CEOs have concerns about public trust in business, falling to 53% of private companies and 43% of family firms.

An overwhelming majority (92%) of private company CEOs around the world are changing how they manage their brand, marketing and communications, and the same percentage are looking at how they define and manage risks.

According to the report, 90% are making more use of technology to assess and deliver on wider stakeholder expectations.

For more on this article, please visit: Business World