Business lobby group Ibec has called on Taoiseach Leo Varadkar to deliver “an economic reboot of unprecedented scale” in response to the coronavirus pandemic that has shuttered schools and businesses across the country.

Fears are growing that the spread of the virus will push businesses into crisis and Ibec warned that “extensive layoffs” were now inevitable over the coming days and weeks as the crisis deepened.

“A coordinated international and multi-agency fiscal stimulus package will ultimately be required in order to reboot our damaged economy,” the group’s Chief Executive Danny McCoy wrote in a letter that was addressed to the Taoiseach and made public.

The Government has already pledged to deliver €3bn in aid to the economy, with extra money for the HSE to help it deal with the crisis as well as supports for business and for those who either lose their jobs or cannot work on a temporary basis.

With lockdowns spreading across countries – the Netherlands became the latest country to impose measures on Sunday, there are now around 180 million Europeans who are facing restrictions on their movements and that will have a huge knock on effect on the economy of the EU and the world.

Ireland is particularly exposed as exports account for a larger share of the economy here than any major country in the EU. Germany, Europe’s economic powerhouse, is not growing at all and Italy has been stricken by a double whammy of recession and ravages of the coronavirus outbreak.

More than 200,000 jobs in the State are dependent on multinational companies in areas like high tech and pharmaceuticals whose exports have helped the economy by more than any other EU economy in recent years, helping to put record numbers of people in work overall.

“By communicating the intent to deliver that stimulus, Government can now help offset some of the panic which is permeating all elements of our economy and society,” Mr McCoy wrote.

The response to the crisis so far has been mixed.

US President Donald Trump has been criticised for moving too slowly and for not providing the kind of leadership needed from the world’s largest economy to fight the crisis.

In the Eurozone, missteps by the European Central Bank’s new Chief Christine Lagarde hit markets and EU governments have been slow to say they will open the spending taps to fight the crisis.

Mr McCoy said that the Government here needed to deliver emergency wage subsidies and welfare programmes to “provide a reasonable basic income to all workers impacted by the crisis”.

“The State must further extend its cashflow supports and forbearance measures through Revenue and local Government and continue to adjust supports which can help preserve as many enterprises as possible through the crisis period,” he urged the Taoiseach in the letter.

Online Editors