Ireland has passed out both the United States and Japan, in terms of development and risen to eighth place in a prestigious world table for human development.
The 2005 Human Development Report, published by the UN Development Programme yesterday, found Irish people to be the second wealthiest in the world, with a GDP per head of $37,738 (€30,384).
However, it also showed that among the world's wealthiest countries, Ireland was one of the most unequal, with the third-highest level of poverty in 18 industrialised countries surveyed.
When all factors were taken into account Ireland rose two places to eighth in the Human Development Index, leapfrogging the US, Japan, Belgium and the Netherlands but falling behind Luxembourg and Switzerland.
Norway was ranked first in the index, a leading global measure of quality of life in 177 countries.
Since 2002, Ireland has risen 10 places in the ranking of economic performance, life expectancy and health and education standards.
Minister for Social Affairs Séamus Brennan said Ireland should be "justly proud" of the progress it had made although "it must be acknowledged that we still have ground to make up in improving life expectancy, educational attainment and adult literacy".
The report included a section entitled: Two tales of Irish poverty which questioned the accuracy of "relative poverty" indicators in rapidly growing economies like Ireland.
It noted that social transfers had risen substantially in Ireland "so pensioners, for example, saw their living standards improve markedly though they still lagged behind rapidly rising incomes resulting from employment and profits.
"Whether this represents 'pro-poor economic growth' remains debatable," the report stated.
Mr Brennan remarked that Ireland had achieved "significant progress in the whole area of social development" and "the outcomes detailed in this report underline the validity of the Government's approach".
A spokesman for the Minister also pointed out that the report was working predominantly off figures from 2003, and since then there had been increases in social welfare rates under two budgets.
The report estimated that 15.2 per cent of Irish people lived in poverty. Only Italy and the US had a higher poverty rate among 18 industrialised countries surveyed.
In addition, Ireland had the second highest rate of illiteracy, after Italy, with 22.6 per cent of the population lacking functional literacy skills.
The report also cited relatively low levels of investment in education and health in Ireland. Some $2,367 per capita was spent on health in 2002 compared to $5,274 per capita in the US.
In general, the report found Ireland to be one of the most unequal countries in the developed world, with the richest 10 per cent of the population having 9.7 times more wealth than the poorest 10 per cent.
Of the top 30 most developed countries in the world, only the US, Hong Kong, New Zealand and Portugal were said to be more unequal.
The report warned that in very unequal societies, economic growth "may have little impact" on reducing poverty, adding "far more attention should be paid to creating conditions under which the poor can increase their share of future national income gains".
The 20 least developed countries in the world were all African, with Niger, Sierra Leone and Burkina Faso coming in last on the index.
The report called on developed countries to increase their commitments to overseas development aid at next week's UN summit in New York, noting that Ireland still lagged behind the UN spending target of 0.7 per cent of GNP.
