Ireland's dream is over as bankers chase McJobs...
In Dublin, the sushi conveyor belt has stopped turning at one of the city's swankiest Japanese restaurants. In the west of the country, a new McDonald's outlet has been inundated with job applicants, among them bankers, architects and accountants. As signs of the times go, it could hardly be more dramatic.
“It's no joke, I had to do a double-take on the CVs,” Kieran McDermott, the franchisee, said. He removed a “Now Hiring” banner on the site of the fast-food restaurant after only ten days. “The jobs were advertised nowhere else.” More than 500 people applied for the 50 available jobs.
From indulging the latest food fad to flipping burgers, Ireland's fall from economic grace has been dramatic. Europe's most successful economy for more than a decade - the famous Celtic Tiger - became the first of the eurozone nations to move officially into recession last autumn.
Since then, the descent into a financial maelstrom has gathered pace. Unemployment has leapt above 10 per cent, with forecasts that it could reach 14 per cent by the end of the year.
After weeks of denying the need, the Government, led by Brian Cowen, the Taoiseach and Fianna Fail leader, finally bowed to the inevitable and announced an emergency Budget.
The U-turn was prompted by publication of catastrophic exchequer figures revealing a black hole opening up in the public finances.
Tax revenue was down by €1.8 billion (£1.6 billion) for the first two months of the year, compared with a deficit of €124 million for the same period in 2008. It means that there will have to be radical - even savage - cuts in public spending and tax rises.
Economic activity appears to be grinding to a halt, most notably in construction and property, the engine of Ireland's boom, or bubble. Capital gains tax receipts were down 83 per cent on last year.
Moreover, bewilderment about how Ireland has got into this mess so suddenly is turning to anger.
About 120,000 public sector workers, including police officers, took to the streets of the capital to protest. In their sights were Fianna Fail, Europe's most successful political party with a record 27 years since it lost a general election, and the banks that poured petrol on the roaring bonfire of the property boom with their reckless lending practices.
Not far behind were the property developers, Ireland's home-grown “masters of the universe”.
Paddy Kelly, one of Ireland's biggest builders who once boasted, when looking out across Dublin's crane-dotted skyline, “most of them are mine”, has admitted he is facing bankruptcy. “My liabilities exceed my assets,” he told Dublin's Commercial Court.
The country's property developers are a group of sometimes flamboyant, largely self-made men in the vanguard of Ireland's New Rich.
Johnny Ronan celebrated a planning battle victory by flying 50 of his friends to Italy, where Luciano Pavarotti sang for them in the gardens of his villa.
Sean Mulryan, whose company Ballymore once claimed to be Canary Wharf's largest landowner, hired Debbie Harry, of Blondie fame, to sing at his 50th birthday party.
In 2004 Derek Quinlan, a former tax inspector, paid £750 million for the Savoy Group of hotels in London. In Ireland it was a source of national pride when the Irish tricolour was flown from the hotel's mast.
Sean Dunne is perhaps the most colourful. His plans to create a Dublin “Knightsbridge” in the leafy suburb of Ballsbridge set price records for land in 2005 when he paid €55 million per acre for two sites comprising the landmark Jurys and Berkeley Court hotels.
The final investment was to have been about €1.5 billion for the development, including a 37-storey “diamond-cut” tower. The dream lies in ruins. Mr Dunne told The New York Times in January that he “could be considered insolvent”. The site he bought is probably worth a quarter of what he paid.
Yet lower down the rungs of the property ladder are scores, perhaps hundreds, of smaller developers who now blame the banks for making it so easy for them to borrow.
Austin Cripps, who owned a shoe business but had branched into property development, took his own life in Dublin in March. John O'Dolan, another developer, was buried in Galway in February: the body of the 51-year-old father of three was discovered in a shed on his property.
Police said they were treating his death as “a tragic accident”. Patrick Rocca, who invested in office buildings in London and in an Argos distribution centre in Bedford, shot himself in Dublin in January.
The mood has swung in Ireland. Even U2 is not immune. The Edge, the band's guitar player, said: “People didn't want to deal with it while the party was going full swing, but now the music has stopped. We've lost a fortune, but it's all on paper ... We still have our jobs.”
The U2 Tower, designed by Lord Foster of Thames Bank, which was to have given Dublin a distinctive new landmark in its docklands, has been shelved.
Emergency budget
— Ireland was forced...to resort to €3.3 billion (£3 billion) of tax rises and spending cuts this year to rein in surging government borrowing, despite the deepening scale of its economic slump.
—The austerity moves in an emergency Budget came even as Ireland sharply downgraded forecasts for its prospects, underlining the scale of the economic woes in the once-booming republic.
— Brian Lenihan, the Finance Minister, unveiled plans for an agency to buy up toxic assets from the country's banks, to be swapped for Irish Government bonds in a new bailout.
— Ireland now expects its economy to shrink by 7.7 per cent this year, having previously expected an already vicious 6.75 per cent contraction.
— In 2010, the Government is projecting a further 2.9 per cent slump before a return to growth, of 2.7 per cent, in 2011.
— With Ireland reeling in the face of soaring unemployment, a housing market crash and a collapse of consumer spending by a fifth, the emergency budget became inescapable as public borrowing headed towards 12.75per cent of GDP for this year.
— Even after the hardline measures, the public deficit for this year will still hit 10.75 per cent of GDP. In future years, Ireland will pursue a return to sustainable finances with spending cuts set to rise from €1.5 billion this year to €4.2 billion by 2011. “If we fail, refuse or neglect to address this structural problem, we will condemn our generation and the next to the folly of excessive borrowing,” Mr Lenihan said.
Report - Irish Times.
In Dublin, the sushi conveyor belt has stopped turning at one of the city's swankiest Japanese restaurants. In the west of the country, a new McDonald's outlet has been inundated with job applicants, among them bankers, architects and accountants. As signs of the times go, it could hardly be more dramatic.
“It's no joke, I had to do a double-take on the CVs,” Kieran McDermott, the franchisee, said. He removed a “Now Hiring” banner on the site of the fast-food restaurant after only ten days. “The jobs were advertised nowhere else.” More than 500 people applied for the 50 available jobs.
From indulging the latest food fad to flipping burgers, Ireland's fall from economic grace has been dramatic. Europe's most successful economy for more than a decade - the famous Celtic Tiger - became the first of the eurozone nations to move officially into recession last autumn.
Since then, the descent into a financial maelstrom has gathered pace. Unemployment has leapt above 10 per cent, with forecasts that it could reach 14 per cent by the end of the year.
After weeks of denying the need, the Government, led by Brian Cowen, the Taoiseach and Fianna Fail leader, finally bowed to the inevitable and announced an emergency Budget.
The U-turn was prompted by publication of catastrophic exchequer figures revealing a black hole opening up in the public finances.
Tax revenue was down by €1.8 billion (£1.6 billion) for the first two months of the year, compared with a deficit of €124 million for the same period in 2008. It means that there will have to be radical - even savage - cuts in public spending and tax rises.
Economic activity appears to be grinding to a halt, most notably in construction and property, the engine of Ireland's boom, or bubble. Capital gains tax receipts were down 83 per cent on last year.
Moreover, bewilderment about how Ireland has got into this mess so suddenly is turning to anger.
About 120,000 public sector workers, including police officers, took to the streets of the capital to protest. In their sights were Fianna Fail, Europe's most successful political party with a record 27 years since it lost a general election, and the banks that poured petrol on the roaring bonfire of the property boom with their reckless lending practices.
Not far behind were the property developers, Ireland's home-grown “masters of the universe”.
Paddy Kelly, one of Ireland's biggest builders who once boasted, when looking out across Dublin's crane-dotted skyline, “most of them are mine”, has admitted he is facing bankruptcy. “My liabilities exceed my assets,” he told Dublin's Commercial Court.
The country's property developers are a group of sometimes flamboyant, largely self-made men in the vanguard of Ireland's New Rich.
Johnny Ronan celebrated a planning battle victory by flying 50 of his friends to Italy, where Luciano Pavarotti sang for them in the gardens of his villa.
Sean Mulryan, whose company Ballymore once claimed to be Canary Wharf's largest landowner, hired Debbie Harry, of Blondie fame, to sing at his 50th birthday party.
In 2004 Derek Quinlan, a former tax inspector, paid £750 million for the Savoy Group of hotels in London. In Ireland it was a source of national pride when the Irish tricolour was flown from the hotel's mast.
Sean Dunne is perhaps the most colourful. His plans to create a Dublin “Knightsbridge” in the leafy suburb of Ballsbridge set price records for land in 2005 when he paid €55 million per acre for two sites comprising the landmark Jurys and Berkeley Court hotels.
The final investment was to have been about €1.5 billion for the development, including a 37-storey “diamond-cut” tower. The dream lies in ruins. Mr Dunne told The New York Times in January that he “could be considered insolvent”. The site he bought is probably worth a quarter of what he paid.
Yet lower down the rungs of the property ladder are scores, perhaps hundreds, of smaller developers who now blame the banks for making it so easy for them to borrow.
Austin Cripps, who owned a shoe business but had branched into property development, took his own life in Dublin in March. John O'Dolan, another developer, was buried in Galway in February: the body of the 51-year-old father of three was discovered in a shed on his property.
Police said they were treating his death as “a tragic accident”. Patrick Rocca, who invested in office buildings in London and in an Argos distribution centre in Bedford, shot himself in Dublin in January.
The mood has swung in Ireland. Even U2 is not immune. The Edge, the band's guitar player, said: “People didn't want to deal with it while the party was going full swing, but now the music has stopped. We've lost a fortune, but it's all on paper ... We still have our jobs.”
The U2 Tower, designed by Lord Foster of Thames Bank, which was to have given Dublin a distinctive new landmark in its docklands, has been shelved.
Emergency budget
— Ireland was forced...to resort to €3.3 billion (£3 billion) of tax rises and spending cuts this year to rein in surging government borrowing, despite the deepening scale of its economic slump.
—The austerity moves in an emergency Budget came even as Ireland sharply downgraded forecasts for its prospects, underlining the scale of the economic woes in the once-booming republic.
— Brian Lenihan, the Finance Minister, unveiled plans for an agency to buy up toxic assets from the country's banks, to be swapped for Irish Government bonds in a new bailout.
— Ireland now expects its economy to shrink by 7.7 per cent this year, having previously expected an already vicious 6.75 per cent contraction.
— In 2010, the Government is projecting a further 2.9 per cent slump before a return to growth, of 2.7 per cent, in 2011.
— With Ireland reeling in the face of soaring unemployment, a housing market crash and a collapse of consumer spending by a fifth, the emergency budget became inescapable as public borrowing headed towards 12.75per cent of GDP for this year.
— Even after the hardline measures, the public deficit for this year will still hit 10.75 per cent of GDP. In future years, Ireland will pursue a return to sustainable finances with spending cuts set to rise from €1.5 billion this year to €4.2 billion by 2011. “If we fail, refuse or neglect to address this structural problem, we will condemn our generation and the next to the folly of excessive borrowing,” Mr Lenihan said.
Report - Irish Times.