Monday 26 August 2019

Ireland to remain EU fastest growing economy this year... and the next - EC

The Central Bank in Dublin
The Central Bank in Dublin

Sarah Collins

Ireland will remain the EU’s fastest growing economy this year and next, the European Commission has predicted.

In its autumn economic forecast today, the Commission said that Ireland’s economy will expand by 6pc this year, far outpacing the EU average of 1.9pc, on the back of thriving exports and high consumer spending.

Ireland’s growth will continue to top the EU’s table next year at 4.5pc, compared to an average of 2pc across the 28-member bloc.

Ireland will drop to joint second place in 2017 with growth of 3.5pc, the Commission predicted.

The figures differ slightly from the Government’s budget day predictions of 6.2pc growth this year and 4.3pc in 2016, with an average of 3pc estimated for the years following.

However, the Commission’s figures don’t take into account the spectre of the UK leaving the EU in a referendum slated for 2017, an outcome that would deal a massive blow to Ireland’s economy, the ESRI said this week.

“We all expect and want the United Kingdom to stay in the European Union, which is positive as well for the EU and for the UK itself,” the EU’s economics chief Pierre Moscovici said during a press briefing in Brussels on Thursday. “Everybody knows it would be a more than important policy change,” he said of a possible UK exit.

The Commission predicts that unemployment in Ireland will continue to fall from 9.5pc this year to 7.9pc in 2017.

The figures also show that Ireland’s budget is in a healthier state, with the deficit - the excess of spending over revenues - estimated at 2.2pc of gross domestic product (GDP) in 2015 and falling to 1.5pc of GDP next year and in 2017. The EU’s upper limit is 3pc.

However, Ireland’s debt - the amount the government borrowed to finance past spending - is to remain in the EU’s top seven this year at 99.8pc, falling to 93.7pc in 2017.

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