While growth is surging to Celtic Tiger levels south of the border, PMIs and other indicators show it grinding to a halt north of the border. And this is before the massive cuts in the public sector, recently introduced by SF, have even begun to take effect.
The main cause seems to be the overvalued exchange rate. The UK has a ‘one size fits all’ policy wrt its exchange rate. Effectively, the sterling exchange rate moves according to how finance-industry-dominated south-east England is doing. This has resulted in an exchange rate that is far too high for the low-productivity low-skill economy that N. Ireland has.
@ JTO
“This has resulted in an exchange rate that is far too high for the low-productivity low-skill economy that N. Ireland has.”
Low productivity low skill is a big loser these days. What does NI need to upscale ?
Debt has reached its mathematical limit of effectiveness and there is no other growth driver so I think sustainable growth is not going to fly absent a revamp of the economic system.
Look at bonds or commodities or China.
We are depending on the US to drive global growth and 92 million people are not part of the workforce. The Phillips curve is dead – see UK deficit. Wages are not rising in response to lower unemployment.
4 replies on “OECD 2015 Going for Growth Report”
Ah yes – Growth!
Well, War is profitable for some and adds to GDP for some …
On Geo-Political Economy in Nulandistan
@all
Text from Paddy Zhukov in Kharkov:
http://www.counterpunch.org/2015/02/06/the-fallujah-option-for-east-ukraine/
Worth reading. A much greater danger to the EU than the rapid commentary on Greek Democracy on previous threads.
There is now a dramatic divergence in the growth outlook between the two parts of this island.
http://gqp.ie/2495/weak-northern-economy-set-to-drive-shoppers-south/
While growth is surging to Celtic Tiger levels south of the border, PMIs and other indicators show it grinding to a halt north of the border. And this is before the massive cuts in the public sector, recently introduced by SF, have even begun to take effect.
The main cause seems to be the overvalued exchange rate. The UK has a ‘one size fits all’ policy wrt its exchange rate. Effectively, the sterling exchange rate moves according to how finance-industry-dominated south-east England is doing. This has resulted in an exchange rate that is far too high for the low-productivity low-skill economy that N. Ireland has.
@ JTO
“This has resulted in an exchange rate that is far too high for the low-productivity low-skill economy that N. Ireland has.”
Low productivity low skill is a big loser these days. What does NI need to upscale ?
Debt has reached its mathematical limit of effectiveness and there is no other growth driver so I think sustainable growth is not going to fly absent a revamp of the economic system.
Look at bonds or commodities or China.
We are depending on the US to drive global growth and 92 million people are not part of the workforce. The Phillips curve is dead – see UK deficit. Wages are not rising in response to lower unemployment.
Macroeconomics has reached another dead end.