YOUNG IRELAND: MAKING IT BETTER:We need to be creative in how we manage our wealth and support young people with fresh ideas, writes SHANE McLOUGHLIN
I’M A 33-year-old university graduate with over 10 years’ experience in the financial services industry. Along with almost all of my former colleagues, I experienced the knock-on effects of the severe economic downturn and the harshness of redundancy.
No doubt Ireland has suffered more than almost any other country in the developed world and many people are finding it very tough at the moment. Add this to the almost continual barrage of bad news and one would think that this country has little chance of emerging from our current problems.
While acknowledging the pain that people are going through, I do believe that, over time, we will emerge as a stronger nation because of the challenges we now have to face up to.
The last 18 months has seen unprecedented macro global events combined with poor domestic policy lead to a “perfect storm” for us here in Ireland. Most economic commentators now accept that a lack of effective regulation in the banking and financial system, particularly in the United States, has been the primary cause of the global downturn.
The sub-prime crisis in the USA appears to have been the catalyst for the worldwide panic we witnessed in the financial system. The development of speculative instruments in the banking and hedge fund industry, greed and the availability of cheap and easy credit were all factors.
In Ireland, these factors, combined with our national obsession with property, fuelled by cheap credit and outdated tax breaks, poor fiscal management by our government and a poor regulatory regime have led us to where we are today.
It seems to me that there is a lot of energy being wasted on pointing fingers at who is to blame for the predicament that we find ourselves in.
While it is important that government and individuals are held accountable for their actions, I believe that it is imperative we now start focusing on how we pull ourselves out of this and move forward in a progressive manner.
We are all free to choose how we view our current difficulties. I believe that we will ultimately emerge stronger from the current challenge thrown at us for many reasons.
I think we still have an excellent education system accessible to all. Many people are upskilling and returning to education. This is great for our future and the development of the “smart economy”.
It is relatively easy to establish a new business in this country and is very much encouraged with various incentives available to “start ups”. It is the development of the small and medium enterprises (SMEs) that will greatly enhance our economic recovery.
The cost base for companies, and the general cost of living, has fallen which will allow us become much more economically competitive as a nation. Indeed Ireland has been virtually alone among non-oil exporting countries in increasing our export levels this year which reflects the underlying strength of our multinational exporters.
The economic uncertainty has, in many cases, led to greater productivity as many people no longer take their jobs for granted like they did in the years of the Celtic Tiger.
People have now been forced to scale back their lifestyles to more sustainable levels and have cut out much of the unnecessary wastage that was prevalent in the boom years. Indeed people are becoming much more aware concerning energy conservation which is good for our environment. We still have, in relative terms, an excellent quality of life in this country, which we forget at times.
This is important when attracting experts in various fields from abroad. Some of the most innovative companies in the world, such as Google, Facebook and Microsoft, have a significant presence in this country, which is encouraging.
Despite what we might be led to believe, we do have enormous natural resources which we have not yet capitalised on. We have some of the most ideal locations in the world for providing alternative energy in the areas of wind, wave and hydro power, not to mention some of the most fertile land on earth. We can become leaders in the field of alternative energy and we need to encourage the private sector to harness these resources.
The enormous and influential Irish diaspora is finally being leveraged (eg the Farmleigh gathering). If managed and developed effectively, our diaspora can make a significant positive contribution to our future.
Many people are now being forced to reconsider what were established norms and, particularly in business terms, tailor their offering very much to clients’ needs.
For my colleagues and I, we have started this process by setting up our own business, Opes Wealth Trust. Our ambition is to work with our clients to identify financial solutions which assist in improving their quality of life and that of their family.
The traditional approach in our industry has been focused primarily on clients’ long-term financial objectives. People have now become much more aware of, and focused on, providing for today as well as the need to prepare for the future. To address this, our approach combines micro focus on today’s financial needs with a macro vision for tomorrow’s requirements. It is the aim of Opes Wealth Trust to assist our clients through the perfect storm.
The downturn has forced many people to think outside the box and emerge from their comfort zones. Many people are setting up new businesses and developing new ideas. Out of these challenges will come valuable experience and successful businesses.
Many of our successful entrepreneurs should be encouraged to mentor emerging groups of young business people.
The Government needs to show much more pro-action in many areas. They need to look at ways of increasing credit to the economy, particularly to businesses. Investing in people and businesses needs to be a priority. We need to look at some creative ideas around supporting and developing indigenous industry.
Pension funds are an enormous source of capital that might be considered along with the vast sums of cash that are now sitting on deposit in banks.
We are a very open economy that is particularly affected by global factors so it is encouraging to see all of the major economies now emerging from recession.
No doubt we face big challenges over the coming months and years. As a nation we have faced adversity many times in the past and if we are to emerge stronger from our current problems we will need to make some big decisions and take decisive action. The longest journey begins with the first step.
Shane McLoughlin is from Limerick. He is a graduate of NUI Galway and the University of Limerick. He is managing director of Opes Wealth Trust, a new business he has set up with a number of colleagues. They are setting up a website and are operating from Opes Wealth Trust, 16 Ely Place, Dublin 2.
Tomorrow: Eloise McInerney on the need for young people to roll back the forces of social and political conservatism