IRELAND WARNED OF HOUSING CRISIS - Ireland and the UK are among the countries most likely to follow the US into a housing slump after residential prices surged in recent years, according to the International Monetary Fund.
In its World Economic Outlook, the IMF said economies that allow easier access to mortgage credit and use homes as collateral are more affected by house-price movements.
It said: 'Countries that look particularly vulnerable to a further correction in house prices are Ireland, the United Kingdom, the Netherlands, and France.'
Peter Sutherland, chair of BP and Goldman Sachs, says that US-style housing market trouble has affected all Western countries. He says that while we will experience a negative effect from the US downturn, it will not be 'apocalyptic'.
Mr Sutherland warns that we must be careful not to take too negative a view of the Irish economy's prospects. He says that Irish stock market has experienced extreme highs and lows in recent times, and this volatility worries him.
He says that the Irish economy can have a bright future – if we work on our competitiveness.
He says that education is a key factor, and that more needs to be spent on third level and science and mathematics at second level. Mr Sutherland adds that third level fees for those who can afford them should also be considered.
