It may be a necessary, but not sufficient, condition for growth, as the Irish experience of the 1980s shows. The supply of capital is another key element in an economy's growth potential, whether that reflects domestic capital accumulation or, as in Ireland's case, significant foreign direct investment inflows. Again, the story here is quite complex.
It may be clear that rates of capital accumulation and, in some cases, the nature and composition of investment, is weak or unfavourable, particularly when compared with other economies. Often, however, the reasons for this are difficult to discern.