The National Competitiveness Council’s (NCC) annual benchmarking report shows that Ireland’s competitiveness has improved significantly in recent years but that recent developments could undo much of the improvements if left unchecked.

NCC chairman, Don Thornhill said the cost of doing in business in Ireland must be contained if growth is to be maintained.

“We must redouble our efforts to contain enterprise costs, ensure that firms have access to sufficient credit to invest and grow, and maximise the productivity of both domestically and international trading firms.

“We are especially concerned about the very real threat to Ireland’s competitiveness,” he said.

“A range of indicators show that Ireland has already begun to slip in terms of our relative cost competitiveness, following a period of improvement during the recession. Such developments threaten to undermine all of the hard-won progress made to date, puts at risk job creation, and damages living standards.”

The report acknowledges the improvements made across a number of areas in recent years however.

The falling rate of unemployment, strong export market, the increase in the State’s borrowing capacity and modest rise in consumer demand were all noted as contributing to Ireland climbing from 24th position in 2011 to 15th in the International Institute for Management Development’s global competitiveness rankings.

The country’s heavy debt burden — as well as that on consumers — and rising enterprise costs threaten to undermine the country’s fragile recovery however.

According to the report, labour costs are again rising following years of decline, industrial electricity prices have increased, and an upward trend is evident across a range of business service costs.