Michael Moynihan (Cork North West, Fianna Fail)

I welcome the opportunity to speak on this debate. People's lives are being affected by job losses and their knock-on effects. The current international financial crisis is the greatest challenge since the Great Depression. Historically, the collapse in 1929 was caused by an over-supply of products that no one wanted to buy. The greatest difficulty we face is that there is a global economic downturn and we exported 80% of what we manufactured. Our main markets were Britain, the European Union and America. They are experiencing an even greater downturn than us — the USA lost 600,000 jobs in January — and there is no demand for our product.

The Government and other State agencies must find out what will be needed in the market place. Someone put it bluntly to me last night, saying that if there was a street where they had enough shovels, no one would try to sell shovels there. We must be targeted in our approach.

We face our greatest ever economic crisis. We talk about the 1980s and 1950s but we must be innovative. We must make a huge effort in research and development. Many small and medium size business are experiencing huge difficulty with financing from the banks and that difficulty must also be addressed. The Government is trying to do that with recapitalisation. It will be difficult, however, because the privately owned banks have decided they will not put any more credit into the system. Like ordinary people, they are afraid to invest. The real difficulty is that small to medium sized enterprises that have grown in the last 15 years are stretched. They need to be innovative and branch out.

We should be encouraging these people to look at innovative ideas to get people back to work, manufacturing products that are needed and wanted in the market place. The difficulty is that not just the domestic market but the international markets have collapsed and a huge stimulus package from the European Union will be necessary. We must have a product available that we manufacture in Ireland. We have an excellent workforce that is highly educated but it is up to the Government and State agencies to ensure we have the edge when there is an economic upturn. This is the greatest challenge facing us since 1929.

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