Ireland is one of the smallest and most open countries in the Eurozone. Thanks to an attractive fiscal and regulatory environment, a skilled English-speaking workforce and access to European Union (EU) markets, the country attracts numerous foreign multinationals (especially in the pharmaceutical, information & telecommunication and electronics industries) which export huge volumes of high value-added finished products to the rest of the world. With only 4.5 million inhabitants, Ireland generates one of the world’s largest trade surpluses, excluding oil and gas exporters.
From mid-1990’s to the 2008 financial crisis, Ireland experienced a period of formidable economic expansion, for which it has won the nickname of “Celtic Tiger”, but this boom was achieved at the cost of excessive distortions. A deep economic crisis occurred in 2010, forcing the EU-IMF to adopt a rescue plan. Since, the implementation of the programme was a success and authorities have embarked on an ambitious fiscal consolidation programme. The flexibility of the economy also allowed competitiveness to be restored quickly. Ireland has fully repaid the IMF and now enjoys very easy market access.
The Irish activity is one of the few that have expanded during the Covid-19 crisis. This illustrates the increasing Country’s dependency on Multi-National Enterprises (MNEs), which now account for half of GDP and saw their business boosted by the pandemic. Besides, Brexit did not have negative immediate consequences for the economy, as Dublin served as preferred destination for capital leaving United Kingdom.
