UNICE, the Europe-wide employers' confederation, has cut its forecast for Irish economic growth this year, but still expects the rate of expansion in the Republic to be among the fastest on the continent in 2003 and 2004.
The organisation, of which Irish employers' group IBEC is a member, published its autumn economic review yesterday.
It forecasts that gross domestic product (GDP) growth in the euro zone's 12 countries will reach just 0.5 per cent by the end of the year, while it will average 0.8 per cent in the EU 15.
However, its figures for the Republic show that GDP growth here is likely to come in at 2.4 per cent in 2003 and 3.2 per cent next year.
Earlier this year, UNICE predicted that the Republic would have 3.4 per cent growth this year.
The only state showing faster growth than the Republic is Greece, with 3.7 per cent and 3.8 per cent forecast for 2003 and 2004 respectively.
It predicts zero growth for Germany this year, and an improvement next year to 1.5 per cent.
It also says that the UK, this country's largest export customer in the EU, will continue to perform well, with 1.8 per cent this year and 2.4 per cent reached in 2004.
Overall, UNICE, has trimmed its forecasts for EU growth from 1.2 per cent to 0.8 per cent this year, and from 2.2 per cent to 1.7 per cent in 2004.
Its report says that the downturn on the continent appears to be "bottoming out" after a worse-than-expected 2003.
However, it states that UNICE is concerned at the fact that Europe is unable to drive growth itself, and instead looks to the United States to lead economic expansion.
The Europe-wide employers' group singles out an overall lack of competitiveness in European businesses as a potential bar to recovery.
"Business has always pleaded for less and better regulation, a lower tax burden and structural reforms that will support European companies' competitiveness," it says.
"Europe's failure to respond to this overall positive policy mix illustrates painfully that this analysis is right."
Commenting on the report last night, Mr Arthur Forbes of IBEC's Irish business bureau in Brussels, said UNICE was keen to emphasise the need for structural reform to boost economic competitiveness.
"It is not enough to just hope that growth will come from outside. Europe has to be able to generate growth from within as well," he argued.
Mr Forbes also stressed that euro-zone members needed to stick to the rules laid down in the Stability and Growth Pact.
