Sir, – Arthur Beesley ought to be commended for tackling the thorny issue of debt dynamics facing Ireland over the medium term ("Long march to debt reduction has only begun", Business Opinion, September 26th)
Small open economies must manage their economies prudently through the entire cycle by integrating fiscal, financial and economic policy in a holistic and tailored manner.
EU institutional frameworks need to be fit for crisis management duties by having at their disposal an extensive array of ready-made instruments to mitigate systemic risks adequately.
Both of these policy responses are indispensable in warding off future large-scale crises.
Thus, while it is welcome to see the independent fiscal council making recommendations for better policy outcomes, the final responsibility lies in the good governance of policymakers at central government level, as well as their counterparts in the EU, based on long-term strategic planning.
A final observation on the large stock of debt that Ireland owns. It is likely even still that the gross outstanding amounts of public debt may have to be rescheduled further in the near term, as it is simply implausible that the country will grow at sufficiently high growth rates to lower the debt/GDP ratio in accordance with EU edicts.
As a further note, the most important statistic is not the ratio itself, yet the total stock of debt – a point which Minister for Finance Michael Noonan et al are no doubt aware of and making appropriate scenario tests to best manage this decidedly sub-optimum economic fact. A rather inconvenient truth indeed! – Yours, etc,
KEVIN NEWMAN,
Glasnevin Avenue, Dublin 11.