Managing the Wealth of Nations

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by Brendan McDonagh, Former Chairman of NT Butterfield and Sons Ltd

 

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“… despite the recent successes in debt markets, we are far from achieving sustainable debt levels.”

Adam Smith first published the “Wealth of Nations” in 1776, some 240 years ago. At that time, the use of sovereign debt was to pay for wars with the debt repaid from higher taxes in the post war period. Today, Ireland has accumulated over €200 billion of debt but thankfully not from waging wars. However, all debts need to be serviced and repaid down to a sustainable level. A few years ago, Ireland could not borrow beyond 100 days tenure. Today it can and has just issued a 100 year bond. In addition, Ireland is transforming its sovereign wealth fund into a sovereign development fund to assist in the economic recovery of the nation. The Ireland Strategic Investment Fund has already committed over €2 billion in direct investments. “Managing the Wealth of a Nation” has become very complicated since Adam Smith’s days.

In our session, we will discuss the current approach to managing the nation’s debts and that, despite the recent successes in debt markets, we are far from achieving sustainable debt levels. In addition, we will explore the pros and cons of deploying a sovereign development fund as an economic tool which is neither traditional fiscal nor monetary policy.

On May 26, I will be joined on the panel by 3 leading experts, namely Conor O’Kelly, CEO National Treasury Management Agency, Ruairi Quinn, Former Minister of Finance, and Frances Ruane, Former Director, Economic & Social Research Institute.

 

For more information go to our website www.tcd.ie/business/forum and to join the conversation follow us on twitter and Facebook

 

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