The prospects for further growth in the Irish economy are good, but heavy investment in infrastructure and human resources is required, the new president of the Economic and Social Research Institute (ESRI) has said. Sir George Quigley said the Republic's society and its economy had been engaged in a major programme of transformation, and should take care to address issues of poverty and social exclusion.

Addressing the ESRI's 40th annual general meeting, Sir George, one of Northern Ireland's leading businessmen, said that, in the absence of external shocks, it seemed likely that the competitiveness of the economy would allow a growth rate of about 5 per cent until at least 2005. However, increased congestion - caused by past under-investment in urban public transport, roads and sanitary services - remained a major concern, he added.

He also noted the increased importance of research and development, and of investing in human capital through the upgrading of skills.

"But there is another side to the buoyant Irish economy and that is concerned with the human face of Irish economic and social development," Sir George said. "Research at the institute over the past decade has shown in very clear terms the disparities which exist within Irish society, particularly the high levels of poverty, inequality and social exclusion."

If the benefits of economic growth were to be shared by the whole community, targeting tax cuts at the lower paid and raising social welfare rates in line with growth in other incomes would have to form part of the Government's approach, he said.

He said he was happy that the authors of the recent report National Investment Priorities for the Period 2000-2006 had devoted effort to considering the North-South dimension of economic development in the whole of Ireland. "There is considerable scope and, indeed, prospects for much greater economic co-operation between the two parts of the island in future," he added.