Economy

Is Ireland A Model For How The West Can Recover?

Lower salaries and a well-structured bailout have made Ireland competitive again, though its export-driven growth is still vulnerable to the fallout of a reeling world economy. Looking for signs of a way out for us all.

Tina Kaiser and Tobias Kaiser

DUBLIN - Julie O'Neill says her job was never as easy as it is today. In 1997, she began staffing the new European headquarters in Ireland for Gilead, the US pharmaceutical company. Gilead had selected Ireland as its European base because its workforce was English-speaking and highly educated.

Yet it was precisely such folk who, during the boom years, were increasingly difficult to find. O'Neill says that Ireland lost its competitive edge before the financial crisis. Average salaries doubled between 2000 and 2007. Not only did workers expect extremely high remuneration, but the prices of real estate, and energy and supplier costs, made Ireland increasingly unfriendly for busines.

So in some ways, the 45-year-old top manager says, the financial crisis was a good thing. Since the market imploded in 2007, production at Gilead has been booming. O'Neill has increased the workforce since then from 120 to 200. And the US company invested 48 million euros in a new 16,000 square meter factory in Cork.

Costs have dropped 12%, while turnover has risen 30% over the past three years. Today, Gilead makes 350 million pills – HIV and AIDS medication – in Ireland. That adds up to about 40% of the company's global turnover.

Finally, buoyed by turnaround stories like this, there's hope in Ireland again. In the first quarter of this year, the economy grew a surprising 1.3% -- well above the 0.5% forecast – and the strongest quarterly growth since 2007. The billions in bailout cash from the International Monetary Fund (IMF) and the European Union seem to have done the trick.

In fact, the Irish government got better results this year than the IMF and the EU were expecting. The main cause of the fall of the "Celtic tiger" had been the banks, which had been overstretched from bad real estate loans.

In the face of a drying up of private investment, the Irish had to pump 70 billion euros, or 45% of their yearly economic output, into their rickety financial sector. So the recent injection of 1.1 billion euros into the Bank of Ireland by a group of institutional investors was greeted with something akin to euphoria.

The money saved the country's largest bank from nationalization, long seen as unavoidable. And economists and investors no longer lump Ireland in the same category as Greece or Spain.

The country is rediscovering its footing with the same exports that were the source for its roaring growth beginning in the 1990s. Ireland had become a favorite location for multinationals thanks to a mix of low taxes, high education and English speakers. Shiny new European headquarters – and factories – for multinational producers of semi-conductors and pharmaceuticals accounted for some one-fourth of its economic growth in the boom years.

Exporting more than before the crisis

Now, Irish companies have again dramatically increased foreign sales since the middle of last year, and exporting more than before the financial crisis.

Three years ago, exports counted for less than 10% of economic performance – that figure has now doubled. In fact, some international companies are complaining of a lack of qualified workers. State-run RTE radio reported in June that 150 of the country's largest firms were willing to increase salaries by 2%. Although unemployment, overall, is still at a record 14%, there is a shortfall of qualified workers. "Our German member companies in Ireland complain of not being able to fill open positions," says Ralf Lissek, who heads the German-Irish Chamber of Industry and Commerce in Dublin.

More than 100 positions are unfilled at German companies SAP and Allianz. Part of that is due to the "loser image" slapped on Ireland in the past three years: with the spectre of the state's possible bankruptcy, failed banks and austerity programs, Ireland lost its sex appeal as a destination for highly qualified foreign workers. "Yet economic performance per capita is still higher in Ireland than it is in Germany," says Lissek.

Still, high dependence on exports could end up easily backfiring, as recovery in Ireland is inevitably linked to a turnaround in the world economy. The crisis of confidence in the U.S. is a worry to any country, like Ireland, heavily dependent on its exports. Ireland's domestic sector would be unable to support growth on its own, as consumers are spending less due to lower salaries and lingering unemployment.

In addition, many households are paying off debts accumulated during the boom years. Before the crisis, the savings rate was 2%; it's now 13%. Consumer spending, meanwhile, continues to slide as it has every month since last year.

The pharmaceutical executive O'Neill says that the single biggest priority now is to increase confidence, adding that the encouraging figures of the past few months have already helped a lot. "Wherever I go, the mood is better than it was a year ago."

The Irish accepted the fact that the government's austerity measures were necessary, and these are beginning to bear fruit. With discipline and hard work, they‘ve overcome other crises, and says O'Neill, expect to get through this one.

Critical for Ireland will be the way the euro debt crisis unfolds. If it spreads from Greece to Italy or Spain, finance markets might lose confidence in Ireland as well. However, the decisions made at the euro summit held in late July were in Ireland's favor: risk spreads for long-term Irish government bonds decreased considerably. And the country was also largely unaffected by the rampant unrest in the markets these past few days.

Economists are even expecting Ireland to be back on the capital market by next year. Says Holger Schmieding, chief economist at Germany's Berenberg Bank, says Ireland could be financing itself on the markets in one year's time: "Ireland could be the first country to leave the debt crisis behind," he said.

Read the original article in German

photo - johnson1952

Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!
food / travel

The True Horrors Behind 7 Haunted Locations Around The World

With Halloween arriving, we have dug up the would-be ghosts of documented evil and bloodshed from the past.

Inside Poveglia Island's abandoned asylum

Laure Gautherin and Carl-Johan Karlsson

When Hallows Eve was first introduced as a Celtic festival some 2,000 years ago, bonfires and costumes were seen as a legitimate way to ward off ghosts and evil spirits. Today of course, with science and logic being real ghostbusters, spine-chilling tales of haunted forests, abandoned asylums and deserted graveyards have rather become a way to add some mystery and suspense to our lives.

And yet there are still spooky places around the world that have something more than legend attached to them. From Spain to Uzbekistan and Australia, these locations prove that haunting lore is sometimes rooted in very real, and often terrible events.

Shahr-e Gholghola, City of Screams - Afghanistan

photo of  ruins of Shahr-e Gholghola,

The ruins of Shahr-e Gholghola, the City of Screams, in Afghanistan

Dai He/Xinhua via ZUMA Wire


According to locals, ghosts from this ancient royal citadel located in the Valley of Bamyan, 150 miles northwest of Kabul, have been screaming for 800 years. You can hear them from miles away, at twilight, when they relive their massacre.

In the spring 1221, the fortress built by Buddhist Ghorids in the 6th century became the theater of the final battle between Jalal ad-Din Mingburnu, last ruler of the Khwarezmian Empire, and the Mongol Horde led by Genghis Khan. It is said that Khan's beloved grandson, Mutakhan, had been killed on his mission to sack Bamyan. To avenge him, the Mongol leader went himself and ordered to kill every living creature in the city, children included.

The ruins today bear the name of Shahr-e Gholghola, meaning City of Screams or City of Sorrows. The archeological site, rich in Afghan history, is open to the public and though its remaining walls stay quiet during the day, locals say that the night brings the echoes of fear and agony. Others claim the place comes back to life eight centuries ago, and one can hear the bustle of the city and people calling each other.

Gettysburg, Civil War battlefield - U.S.

photo of rocks and trees in Gettysburg

View of the battlefields from Little Round Top, Gettysburg, PA, USA

Unsplash/@nemo23


Even ghosts non-believers agree there is something eerie about Gettysbury. The city in the state of Pennsylvania is now one of the most popular destinations in the U.S. for spirits and paranormal activities sight-seeing; and many visitors report they witness exactly what they came for: sounds of drums and gunshots, spooky encounters and camera malfunctions in one specific spot… just to name a few!

The Battle of Gettysburg, for which President Abraham Lincoln wrote his best known public address, is considered a turning point in the Civil War that led to the Union's victory. It lasted three days, from July 1st to July 3rd, 1863, but it accounts for the worst casualties of the entire conflict, with 23,000 on the Union side (3,100 men killed) and 28,000 for the Confederates (including 3,900 deaths). Thousands of soldiers were buried on the battlefield in mass graves - without proper rites, legend says - before being relocated to the National Military Park Cemetery for the Unionists.

Since then, legend has it, their restless souls wander, unaware the war has ended. You can find them everywhere, on the battlefield or in the town's preserved Inns and hotels turned into field hospitals back then.

Belchite, Civil War massacre - Spain

photo of sunset of old Belchite

Old Belchite, Spain

Belchite Town Council


Shy lost souls wandering and briefly appearing in front of visitors, unexplainable forces attracting some to specific places of the town, recorded noises of planes, gunshots and bombs, like forever echoes of a drama which left an open wound in Spanish history…

That wound, still unhealed, is the Spanish Civil War; and at its height in 1937, Belchite village, located in the Zaragoza Province in the northeast of Spain, represented a strategic objective of the Republican forces to take over the nearby capital city of Zaragoza.

Instead of being a simple step in their operation, it became the field of an intense battle opposing the loyalist army and that of General Francisco Franco's. Between August 24 and September 6, more than 5,000 people were killed, including half of Belchite's population. The town was left in rubble. As a way to illustrate the Republicans' violence, Franco decided to leave the old town in ruins and build a new Belchite nearby. All the survivors were relocated there, but they had to wait 15 years for it to be complete.

If nothing particular happens in new Belchite, home to around 1,500 residents, the remains of old Belchite offer their share of chilling ghost stories. Some visitors say they felt a presence, someone watching them, sudden change of temperatures and strange sounds. The ruins of the old village have been used as a film set for Terry Gilliam's The Adventures of Baron Munchausen - with the crew reporting the apparition of two women dressed in period costumes - and Guillermo del Toro's Pan's Labyrinth. And in October 1986, members of the television program "Cuarta Dimensión" (the 4th dimension) spent a night in Belchite and came back with some spooky recordings of war sounds.

Gur Emir, a conquerer’s mausoleum - Uzbekistan

photo of Gur Emir (Tomb of Timur) i

Gur Emir (Tomb of Timur) in Samarkand, Uzbekistan

Chris Bradley/Design Pics via ZUMA Wire


The news echoed through the streets and bazaars of Samarkand: "The Russian expedition will open the tomb of Tamerlane the Great. It will be our curse!" It was June 1941, and a small team of Soviet researchers began excavations in the Gur-Emir mausoleum in southeastern Uzbekistan.

The aim was to prove that the remains in the tomb did in fact belong to Tamerlane — the infamous 14th-century conqueror and first ruler of the Timurid dynasty who some historians say massacred 1% of the world's population in 1360.

Still, on June 20, despite protests from local residents and Muslim clergy, Tamerlame's tomb was cracked open — marked with the inscription: "When I Rise From the Dead, The World Shall Tremble."

Only two days later, Nazi Germany invaded the Soviet Union, with the people of Samarkand linking it to the disturbing of Tamerlane's peace. Amid local protests, the excavation was immediately wrapped up and the remains of the Turkish/Mongol conqueror were sent to Moscow. The turning point in the war came with the victory in the Battle of Stalingrad — only a month after a superstitious Stalin ordered the return of Tamerlane's remains to Samarkand where the former emperor was re-buried with full honors.

Gamla Stan, a royal massacre - Sweden

a photo of The red house of Gamla Stan, Stockholm, Sweden

The red house of Gamla Stan, Stockholm, Sweden

Unsplash/@hkblind


After Danish King Kristian II successfully invaded Sweden and was anointed King in November 1520, the new ruler called Swedish leaders to join for festivities at the royal palace in Stockholm. At dusk, after three days of wine, beer and spectacles, Danish soldiers carrying lanterns and torches entered the great hall and imprisoned the gathered nobles who were considered potential opponents of the Danish king. In the days that followed, 92 people were swiftly sentenced to death, and either hanged or beheaded on Stortorget, the main square in Gamla Stan (Old Town).

Until this day, the Stockholm Bloodbath is considered one of the most brutal events in Scandinavian history, and some people have reported visions of blood flowing across the cobblestoned square in early November. A little over a century later, a red house on the square was rebuilt as a monument for the executed — fitted with 92 white stones for each slain man. Legend has it that should one of the stones be removed, the ghost of the represented will rise from the dead and haunt the streets of Stockholm for all eternity.

Port Arthur, gruesome prison - Australia

a photo of ort Arthur Prison Settlement, Tasmania, Australia

Port Arthur Prison Settlement, Tasmania, Australia

Flickr/Eli Duke


During its 47-year history as a penal settlement, Port Arthur in southern Tasmania earned a reputation as one of the most notorious prisons in the British Empire. The institution — known for a brutal slavery system and punishment of the most hardened criminals sent from the motherland— claimed the lives of more than 1,000 inmates until its closure in 1877.

Since then, documented stories have spanned the paranormal gamut: poltergeist prisoners terrorizing visitors, weeping children roaming the port and tourists running into a weeping 'lady in blue' (apparently the spirit of a woman who died in childbirth). The museum even has an 'incidence form' ready for anyone wanting to report an otherworldly event.

Poveglia Island, plague victims - Italy

a photo of Poveglia Island, Italy

Poveglia Island, Italy

Mirco Toniolo/ROPI via ZUMA Press


Located off the coast of Venice and Lido, Poveglia sadly reunites all the classical elements of a horror movie: plagues, mass burial ground and mental institute (from the 1920's).

During the bubonic plague and other subsequent pandemics, the island served as a quarantine station for the sick and anyone showing any signs of what could be Black Death contamination. Some 160,000 victims are thought to have died there and the seven acres of land became a mass burial ground so full that it is said that human ash makes up more than 50% of Poveglia's soil.

In 1922 a retirement home for the elderly — used as a clandestine mental institution— opened on the island and with it a fair amount of rumors involving torture of patients. The hospital and consequently the whole island was closed in 1968, leaving all the dead trapped off-land.

Poveglia's terrifying past earned it the nickname of 'Island of Ghosts'. Despite being strictly off-limits to visitors, the site has been attracting paranormal activity hunters looking for the apparition of lost and angry souls. The island would be so evil that some locals say that when an evil person dies, he wakes up in Poveglia, another kind of hell.

Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!
THE LATEST
FOCUS
TRENDING TOPICS
MOST READ