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The secret behind the scenes: Why is Ireland on par with the East Asian Tigers?
From the mid-1990s to the late 2000s, Ireland's economy grew rapidly, a period known as the "Celtic Tiger." The term describes an economic boom fueled by foreign direct investment, although a subsequent housing bubble led to a severe economic recession. In the early 1990s, Ireland was still a relatively poor country by Western European standards, facing the challenges of high poverty rates, high unemployment and low economic growth.
Between 1995 and 2000, Ireland's economic growth averaged 9.4%.
In the following ten years, Ireland still maintained an average growth rate of 5.9% until the economic recession in 2008. Ireland's rapid economic growth is considered a rare example of one of the few Western countries that can rival the East Asian tigers. The reasons for this economic boom are diverse, with one major factor being state-driven economic development, including social partnerships between government, trade unions and employers, coupled with an increase in the female workforce, which has contributed to Ireland's overall economic growth.
Ireland's economy has successfully transformed from a poor country in Western Europe to one of the richest.
The Rise of the Celtic Tiger
The concept of the Celtic Tiger first appeared in a 1994 Morgan Stanley report and was subsequently widely used, becoming a synonym for describing this economic miracle. Low taxes that increase foreign direct investment and English-speaking workforce are among the main factors that set Ireland apart from other international markets as a whole.
Over time, the country's GDP growth rate has been as high as 11.5%. However, the rising housing prices and large-scale construction projects that accompanied the prosperity also posed the hidden danger of economic recession in the Celtic Tigers.
Many economists believe the rise of the Celtic Tiger was due to a combination of the entry of American companies and low tax policies.
Signs of recession
By 2007, the hidden worries of the financial crisis gradually emerged, and the economic challenges facing Ireland suddenly intensified. Some experts pointed out that the government's excessive reliance on the housing market and its failure to effectively regulate the economy have caused serious imbalances in the operation of the entire country.
As house prices plummeted and domestic demand waned, the economy fell into recession in 2008, and it all happened so quickly that it was like "falling from the Celtic Tiger into a financial panic."
The Irish Times declares that the country is shifting from prosperity to economic unease in a rapidly changing environment.
Stability and recovery
In 2015, Ireland's economy ushered in a new period of growth, with a growth rate of 6.7%. This time, the economic revival will depend not only on foreign direct investment but also on the rise of a domestic entrepreneurial boom. As the economy booms again, Ireland is embarking on a unique path towards effectively promoting local industry.
Culture and Social Change
The rapid economic growth has brought about significant changes in Irish society. The improvement of the living environment and the improvement of consumption levels have led to a steady increase in the quality of life, but with it has also been a widening of the gap between the rich and the poor. According to a report by the Institute of Economic and Social Research, economic prosperity has not benefited everyone, but has benefited higher-income groups more.
At the same time, the arrival of waves of immigrants made Ireland's culture more diverse. The increase in migrant workers has given many towns a different look. \n
Economists say some of Ireland's growth may be due to overbuilding and reliance on the housing market.
Facing new challenges
Will Ireland's economic boom last? Current challenges include how to effectively promote local industries, reduce dependence on the external economy and improve the competitiveness of domestic enterprises. While relying on external resources, Ireland must think about how to retain local talent and promote comprehensive economic development.
In addition, environmental problems, especially dependence on imported energy, have forced the Irish government to rethink its economic structure and seek renewable energy solutions.
The evolution of Ireland's economy is not only a country's development story, but also a reflection on how to respond to changes and seek its own positioning in the process of globalization. How can Ireland stay on its economic growth path and keep pace with other economies in the future?
