Irish economy faces record downturn

From 2008 to 2010 Ireland is to suffer the largest contraction of any industrialized country since the 1930s, think-tank predicts. The Irish gross domestic product will fall by 11.6% from 2008 to 2010, the Economic and Social Research Institute, ESRI, forecast in a statement released Wednesday. "By historic and international standards, this is a truly dramatic development," ESRI, an independent institute partly funded by the finance ministry, announced. "Prior to this, the largest decline for an industrialized country since the 1930s had been in Finland, where real GDP declined by 11% between 1990 and 1993," the statement said. Ireland, beaten by the global economic downturn, was the first Euro-zone nation to feel the recession in the beginning of 2008. The ESRI welcomed efforts by the Irish government to deal with billions of euros in risky property loans which have battered the country's banking sector. The ESRI expects Ireland to be obliged to cut 300,000 jobs before 2011 as the recession extends. The think-tank also predicts that the rate of Irish unemployment during 2010 will average 17%. According to the report, by the end of next year, living standards in Ireland will be lower than in 2007.