Bernard Durkan (Kildare North, Fine Gael)
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Question 58: To ask the Minister for Enterprise, Trade and Innovation if he will outline his proposals, if any, for the restoration of competitiveness and cost effectiveness throughout industry with specific reference to manufacturing, services, transport and retail in view of the impact of such sectors on the wider economy; if he has engaged with the various interested parties with a view to identifying a broad strategy that can place this country on at least a level footing with its immediate competitors and trading partners; and if he will make a statement on the matter. [19310/10]

Batt O'Keeffe (Cork North West, Fianna Fail)
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Since January 2008, Ireland has regained competitiveness as domestic inflation remains below that of our main trading partners and the euro weakened – in February 2010, Ireland's real harmonised competitiveness indicator (HCI) was back to its January 2005 position. Improving our relative cost competitiveness requires the cost of doing business in Ireland to fall relative to that of our trading partners. Data which will be published shortly by the NCC will show that prices in Ireland have moderated in the past year, particularly property and energy prices. In addition, at an economy wide level, Irish labour wage rates – when adjusted for productivity – are becoming more cost competitive.

In parallel to the fundamental steps taken over the past 18 months to stabilise the public finances and restore the banking system, the necessary price adjustment to restore competitiveness is underway. Business costs have fallen: wage bills, asset prices, energy and prices in general have responded to the effects of recession and corrective government action. This is resulting in improvements to cost competitiveness across the economy in the manufacturing and services sectors. Further strengthening Ireland's competitive position will foster economic growth. I am working with my colleagues in Government to further embed the improvements already achieved and to strengthen Ireland's relative international competitiveness position.