Ireland: 'It will take a decade for the economy to recover from the fallout of the collapse of the property market'

from irish times.......

"Irish property prices have yet to hit bottom and as a result the final bill for bailing out the banks is likely to be in the region of €90 billion to €100 billion, economist Morgan Kelly said last night.

In the Hubert Butler Lecture to the Kilkenny Arts Festival last night, Mr Kelly said: "We are very far from the bottom" of the property market and it will take a decade for the economy to recover from the fallout of the collapse of the property market.

He estimated Irish debt levels will rise to between €240 billion and €250 billion by 2015, far higher than the current Government estimates of €200 billion and said that there was no way the country can repay this level of debt.

The UCD economist said the Irish economy would require a decade to recover.

Mr Kelly said the recent US spending deal that allowed the debt ceiling to be raised, but avoided raising taxes to try and plug the widening deficit, was “catastrophic” and added that "as the US goes under that will hit Ireland very, very badly".

The UCD lecturer said in the past he had believed that Ireland could walk away from the current bailout. However, he said last night he now thinks "we are stuck [with it]".............READ MORE