Ireland faces record recession

Ireland is facing its deepest ever recession as the coronavirus lockdown devastates jobs and strains the public finances, a think tank said on Thursday.

A report by Ireland’s Economic and Social Research Institute predicts the nation’s gross domestic product (GDP) will decline 12.4 percent in 2020. That was the “most likely” scenario under a government plan to lift the lockdown in August but with the economy struggling to return to pre-pandemic levels owing to physical distancing measures, ESRI said.

A more modest scenario predicting a vigorous recovery after lockdown would still see GDP shrink 8.6 percent, whilst a second wave of coronavirus infections could cause output plunge 17.1 percent.

“Regardless of the scenario, the Irish economy is set to experience the largest annual decline in its history,” an ESRI statement said. “All aspects of the economy will be considerably affected with significant declines in consumption, investment and exports of goods and services,” it added.

Ireland’s unemployment rate soared to 28 percent in April, almost double the figure following the 2008 global financial crisis that led to a huge international bailout of the eurozone member state.