The Irish Independent reports
that as many as one in five shops are now vacant, with a greater rate of
business failures over the past six months than at any time in the history of
Evidence from trade groups revealed the past
three months represent the worst trading performance for the Irish retail sector
since the financial crisis erupted five years ago. Retail vacancy rates have
soared following a series of high-profile closures including HMV, GAME and
Cork-based Flor Griffin. NAMA, now one of the primary landlords in Irish city
centres, has been urged to take steps to promote trade by offering rental
The vacancy rates now include:
• 10.6pc of shops empty in Dublin.
• 20pc of stores empty in Cork.
• 15pc of business and retail outlets vacant in
• 18pc of stores empty in Athlone.
Irish Chambers of Commerce and Retail Excellence
Ireland (REI) have now demanded urgent action by Irish councils and NAMA to
tackle the retail haemorrhage.
REI and Irish Chambers are now meeting city
managers in a bid to promote greater flexibility with commercial rates and
enhanced business supports.
Traders are also pleading for "commercial
reality" in terms of rents which, despite the recession, have not been reduced
in many cases.
One of Ireland's hardest hit cities is Cork
where, on one city centre street (Grand Parade) the vacancy rate is 25pc.
The average retail vacancy rate across the entire
city centre is 20pc while the showcase retail area, Patrick Street, has a 12pc
Last year the vacancy rate had declined, only to
surge before Christmas.
Lord Mayor John Buttimer admitted that it poses a
"Nobody wins with an empty premises and it also
impacts on business and trading levels nearby," he said.
In Dublin, there is a huge contrast in vacancy
rates which are as low as 2.5pc on prestigious locations such as Grafton Street
and Henry Street. But they are as high as 24pc in areas of the north and south
In Limerick, commercial rates were cut in a bid
to boost the retail sector. There are now 297 retail units in Limerick city
centre with a current vacancy rate of 11pc although across the entire city the
rate is 15pc.
The Irish Independent also
reports that confidence among Irish chief executives has risen to the highest
levels since records began in 2009, with more CEOs planning to take on new
employees, business lobby group IBEC said yesterday.
The IBEC Business Sentiment Survey for the first
quarter of this year shows that one in four managers indicated that they would
be hiring new employees in the coming quarter. The figure was one in five in the
last quarter of 2012.
The survey suggests consumer spending and
business investment rose in the second half of last year and the trend will
continue this year. Sales and orders are also rising. The survey is another
indicator suggesting that the worst is over. The Central Statistics Office said
last week that the economy expanded 0.9pc last year although growth appears to
have been flat in the second half.
"The improvement in confidence is predominantly
due to recovery in the domestic economy," said IBEC economist Fergal O'Brien.
"The Irish economy is clearly rebalancing and it is very positive to see the
sentiment readings for both domestic and export activity in positive territory
in the first quarter of this year."
The domestic and export sales outlook improved in
the first quarter, with domestic sales expectations reaching its highest reading
to date, the survey found.
Chief executives' perceptions of the overall
business environment rose to a series high, with managers' confidence in their
own businesses also hitting a new high.
"It now appears that sustained job creation is
taking hold in the exporting sectors," said Mr O'Brien. "Given the positive
reading from our employment index, which correlates well with the official
labour market data from the CSO, we should see the trend of jobs growth continue
and strengthen during 2013."
The new survey comes after a raft of other
measures also implied that the economy is in recovery mode. The benchmark ISEQ
Overall Index flirted with the 4,000 level last week and had reached several
four-year highs this month.
Davy Stockbrokers said earlier this month that it
was raising its 2013 forecast for economic growth following "surprisingly
strong" investment spending. The stockbroker now believes Irish gross domestic
product will grow by 1.3pc this year rather than the 0.9pc forecast a few months
Davy economist Conall Mac Coille also
expects employment to rise this year for the first time since 2007 despite
worries about falling merchandise exports and the so-called pharmaceutical
patent cliff continues to surpass the value of pharma exports.
Times reports that in return for the€ 10 billion package of rescue loans, Cyprus
must drastically shrink its outsized banking sector, cut its budget, implement
structural reforms and privatise state assets, he said.
Minister for Finance Michael Noonan welcomed the deal which he said protected
small depositors and reaffirmed the position that all deposits in European banks
up to €100,000 were guaranteed.
He said the Laiki bank would be spilt into a “good bank” and a “bad bank” with
the bad part wound down and the other adequately capitalised into a “pillar
bank” to support the economy.
He said the deal had the unanimous support of the 17 euro zone countries.
The European Central Bank (ECB) had threatened to cut crucial emergency
assistance to the country’s banks by tomorrow without an agreement.
So without an agreement by tonight it would have faced the prospect of
bankruptcy, which could have forced it to become the first country to abandon
The finance ministers accepted the plan reached in 10 hours of negotiations in
Brussels between Cypriot officials and the troika.
“We believe that this will form a lasting, durable and fully financed solution,”
said IMF chief Christine Lagarde.
Under the plan, Cyprus’ second-largest bank, Laiki, will be restructured and
holders of bank deposits of more than €100,000 will have to take losses, Mr
Dijsselbloem said, adding that it was not yet clear how severe they would be.
“This will have to be worked out in the coming weeks,” he added, noting that it
is expected to yield €4.2 billion overall.
Savers’ deposits with all Cypriot banks of up to €100,000 will be guaranteed by
the state in accordance with the EU’s deposit insurance guarantee, Mr
Laiki will be dissolved immediately into a bad bank containing its uninsured
deposits and toxic assets, with the guaranteed deposits being transferred to the
nation’s biggest lender, Bank of Cyprus.
Large deposits with Bank of Cyprus above the insured level will be frozen until
it becomes clear whether or to what extent they will also be forced to take
losses, the Eurogroup of finance ministers said in a statement.
Mr Dijsselbloem defended the creditors’ approach to make deposit holders take
heavy losses, saying the measures “will be concentrated where the problems are,
in the large banks”.
The Cypriot president, Nicos Anastasiades, flew to Brussels with his finance
minister Michael Sarris yesterday afternoon as the EU and IMF upped the pressure
on Cyprus to accept a deal or face financial collapse.
Some Cypriots accused the president of betraying the Cypriot people and demanded
his resignation, while others called for a referendum on the proposed bailout.
As talks foundered on the issue of bank restructuring, Cypriot state media
carried reports that President Anastasiades was threatening to resign.
In a sign of the difficulties that still remained in reaching agreement, the
meeting of euro zone finance ministers was delayed by almost four hours,
commencing just before 10pm.
Earlier, Mr Anastasiades and Mr Sarris met the heads of the European Council,
European Commission and the group of 17 euro zone finance ministers. They were
later joined by IMF managing director Christine Lagarde and Mario Draghi, head
of the European Central Bank.
Mr Noonan had earlier said the EU’s guarantee on deposits under €100,000 was
“We would never hit depositors in Ireland, we believe the €100,000 is absolutely
sacrosanct and there is absolutely no circumstances in which we would touch
depositors because they are guaranteed and that guarantee applies across the
euro zone,” he said.
While political discussions took place in Brussels, protests continued in
Cyprus. Party leaders were summoned in the afternoon to the presidential palace
to be briefed on Skype by Mr Anastasiades.
Mr Anastasiades tweeted, “We are undertaking great efforts. I hope we have a
solution soon.” He also spoke on the phone to US secretary of state John Kerry,
who was in Baghdad. On Saturday, employees of Laiki Bank and the Bank of Cyprus
demonstrated outside their union offices.
The Irish Times also reports that a number of senior
figures in the Coalition yesterday moved to reassure families struggling with
unaffordable mortgage debt that the new personal insolvency scheme would not
involve “horrendous” measures.
They were responding to reports that guidelines to be published after Easter by
the Insolvency Service of Ireland might put pressure on one of the parents in a
family to give up work should the costs of childcare exceed the income from
“It would be a crazy circumstance if people were being forced out of the
workforce to keep up payments,” said Minister of State Brian Hayes. “It’s a bit
fanciful to suggest that. If that happens the Government will have to take
“If there are horrendous calls where people are forced out of the workforce we
will have to look at it,” he said.
Labour Party Minister of State Seán Sherlock expressed similar sentiments.
“It should not be the case that people are prevented from going out to work. I
would expect that such a regime will not be allowed to proceed,” he said.
The agency has been established under the new Personal Insolvency Act, and will
publish its guide for three different schemes set out under the Act – for
secured debt over €20,000; unsecured debt over €20,000; and debts of less than
Last night the Department of Justice also indicated that people would not be
forced to give up work. “The Guide aims to strike a fair balance at all times
between the insolvent debtors and their creditors,” it said.
“A ‘reasonable standard of living’ does not mean that a person should live at a
luxury level but neither does it mean that a person should only live at
subsistence level. A debtor should be able to participate in the life of the
community, as other citizens do.” It said common sense would apply.
The Government has conceded that households seeking to write down debt will have
their personal budgets subjected to micromanagement. Items such as second cars,
Sky Sports TV packages, holidays and medical insurance may be deemed as
Minister for Jobs Richard Bruton said on RTÉ yesterday that debt resolution
would require “sacrifices from . . . the individuals [involved]”.
Examiner reports that in a written Dáil response to Sinn Féin’s Pearse Doherty,
Mr Noonan said that €8.75m is to be paid in fees to 17 primary dealers in
government bonds in connection with the sale.
Mr Noonan said 89%, or €7.7m, of this was paid to six of the primary dealers:
Barclays, Danske Bank, Davy, Goldman Sachs International, HSBC, and Nomura,
which acted as joint lead managers having significant roles in the new 10-year
Mr Noonan said that the remaining 11% is to be paid to 11 other primary dealers
who were co-leads in the syndicate with lesser roles.
“It is important to emphasise that the team of primary dealers, chosen to manage
the transaction, assisted in building a strong order book, with some 400
investors submitting bids, including fund managers, banks, pension funds, and
insurance companies,” Mr Noonan said.
“The total bids received amounted to some €13bn. This clearly demonstrates that
Ireland has regained access to the international debt markets.
“The size of the order book and the broad investor interest is a strong signal
of confidence in Ireland.”
The NTMA, headed up by chief executive John Corrigan, has been issuing bonds
with lengthening maturities since July, when the first bonds since the bailout
were placed with investors.
The recent sale was the NTMA’s first new 10-year issuance since Jan 2010.
On the role of primary dealers, Mr Noonan said: “The NTMA recognises 17 primary
dealers in Irish Government bonds, all of which are members of, and regulated
by, the Irish Stock Exchange.
“Primary dealers have obligations with respect to market-making in Irish
government bonds, an essential role in the provision of liquidity to investors.
“They also advise the NTMA with respect to issuance and assist with the
marketing process as well as producing research designed to assist investors.
“The NTMA has advised that the fee payable to the syndicate of banks was 0.175%
of the nominal debt issued.
“This is the standard fee for the issue of bonds of a 10-year maturity by
syndication in the euro area sovereign bond market and is also, for example, the
fee paid by the European Investment Bank, which has an AAA credit rating, for
its 10-year bond issuance.”
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