Is the euro crisis inadvertently going to help us?

hatrickpatrick

Well people are always saying "If we still had our own currency, we could combat recession by devaluing it".

Now that the Euro is plunging on all the bailout worries in Portugal, will this have the side effect of boosting our exports?

whiteonion

hatrickpatrick wrote: »

Well people are always saying "If we still had our own currency, we could combat recession by devaluing it".

Now that the Euro is plunging on all the bailout worries in Portugal, will this have the side effect of boosting our exports?

I don't see how making people poorer by depreciating the currency is going to help the economy in the long run. It's a bit like pissing in your pants, at first it can be nice and warm... but in the long run it's cold and icky.

hatrickpatrick

It only makes things expensive to import, the domestic market will deflate, surely?

It does, on the other hand, massively improve competitiveness.

jhegarty

It makes our exports cheaper.

If we still have punts we would have devalued by at least 15% long ago.

PhatPiggins

jhegarty wrote: »

It makes our exports cheaper.

If we still have punts we would have devalued by at least 15% long ago.

Conviently the currencies of our trading partners i.e. UK and US are appreciating against the euro.

Hopefully at some stage in the near future our competitiveness will improve due to factors we control like productivity and non labour costs instead of the current trend of favourable changes in the € exchange rate and the fact we're willing to work for less.

whiteonion

if we slashed our wages down to Romanian wages this country would be alot more competitive but would you want to live like that? should we become more "competitive" by lowering our standard of living to the same level of Romania?

ei.sdraob

@OP quite a few of the export destinations are in the euro

PhatPiggins

whiteonion wrote: »

if we slashed our wages down to Romanian wages this country would be alot more competitive but would you want to live like that? should we become more "competitive" by lowering our standard of living to the same level of Romania?

I don't know who you're post is aimed at but as I said above I'd rather see competitiveness improve through productivity rather then working for less.

The only sector showing any real productivity improvemsnts are the FDI industries and they pay above average wages.

Dannyboy83

Petrol to get ever more expensive, ffs.

Ave Sodalis

I think we could change our currency IF we would stop exporting everything we have, decreasing the need to import. Yes, export the excess and the un-necessary but keep the things we need instead of buying things in that we already have.

This way, we aren't relying on keeping the euro for trade as much...

dynamick

euro is strengthening against the dollar and pound. what is this thread about?