The Tanaiste is predicting the Irish recession will be over by next year.

Eamon Gilmore believes enormous economic growth potential is on the horizon.

In an interview with the Irish Times he says a 'post-recession' republic will become apparent by the end of this year.

"We believe that we are now at a stage where we can start looking forward. We have been mired in economic recession. As we move into 2013, we will be able to look beyond that crisis" he is quoted as saying.

"My parting words to the parliamentary party was when we come back in 2013 we will need to be talking and thinking about what post-recession Ireland will look like".

"I see enormous potential. The EU presidency absolutely parallels what we are doing, concentrating on jobs and growth and trade" he added.

Confident over debt deal

He also dismissed any suggestion the party has been damaged by recent defections particularly those of party chairman Colm Keaveney and former minister of state Róisín Shortall.

He told the Irish Times "The Labour Party and I are not going to be deflected from that. In the midst of battle we are not going to have bouts of nervousness and second opinions about that task".

"There are some people in the Labour Party who are more comfortable in Opposition than . . . Government".

He said the big factor in 2012 was the Stability Treaty referendum.

"People had the opportunity of looking at the alternatives . . . to send the IMF home. They made the decision [to back] the broad strategy we are pursuing" he added.

He also concluded that he believes a deal will be struck over Irish bank debt.

"I believe there is going to be a commitment and understanding in Europe that the EU needs a winner to come out of [a bailout] programme. Ireland is the best placed to do that".

Speaking before Christmas Mr. Gilmore told the Dail the current crisis is about survival for many.