Sharon Donnery: Small open economies - vulnerabilities in a changing world

Speech by Ms Sharon Donnery, Deputy Governor of the Central Bank of Ireland, at the Dublin Economics Workshop 2019, Wexford, 13 September 2019.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Central bank speech  | 
02 October 2019

Good afternoon,

It is a pleasure to be here speaking at the Dublin Economics Workshop today, and I especially welcome the topic of this panel - Small open economies - Vulnerabilities in a Changing World.

The concept of openness has perhaps never been so pertinent.

Until recently, the world was broadly becoming more open, tariffs and capital controls were being eased or removed entirely.

Ten years ago it would have been hard to imagine the rising protectionist sentiment, and indeed actions we see in parts of the world today and the pressures on multilateralism. And while not the focus of my remarks today, this reflects that globalisation or openness can come at a cost, leading to more competition and so creating winners and losers.

This can cause higher unemployment and reduce wages in affected sectors. Indeed it does seem at times that some of the merits of economic openness have been all but forgotten.