The Celtic Tiger: Ireland’s Economy in the 1990s

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Originally published at the Crawley Irish Festival August 2004

The Irish economy has changed considerably since Ireland entered the European Union in 1973, with the United Kingdom and Denmark. Back then it was by far the poorest nation in Europe. The amount of capital in the economy per head of population – or GDP – was just 67% of the EU average and unemployment hovered around 20%.

Thirty years later, the Irish economy is the fastest growing in the European Union with growth approaching 10% annually. As a result, the Irish economy has achieved iconic status with economists referring to it, simply, as the Celtic Tiger.

To put this into perspective, we have to acknowledge that the average growth rates over the last ten years have been around 2% across the EU with unemployment around 8% in Germany. In Ireland, unemployment is a just 3.4%.

Since the economic and corporate tax policies that began in Ireland (arguably) in 1987, the Irish economy has exceeded all expectations. Encouraged by tax exemptions and the volume of skilled labour, international corporations such as Microsoft, Dell and Intel have located in Ireland.

Since 1987, Dell, Microsoft and Intel have each contributed more than €4 billion to the economy. The Irish economy is the most technologically advanced in the European Union with approximately 20% of its workforce employed by technology companies directly or indirectly.

Whilst Ireland is dependent upon the global economy that has slowed in recent years, it is fully expected to recover by 2005. Moreover, the 2001 Census showed substantial population increases when the Irish abroad began returning throughout the 1990s.

Believe it or not, the Irish economy surpassed the GDP of Germany and the UK to become Europe’s second most successful economy in 2002, behind only Luxembourg. Whilst economists have prophesised doom and gloom for the past ten years, the Celtic Tiger has not lost its teeth.

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