asked the Minister for Finance if he will make a statement on the recent OECD report and in particular, on the prediction in that report that emigration will continue to run at a very high level for the foreseeable future; and the steps he proposes to take to address this situation.
Written Answers. - OECD Report.
27.
I presume that the Deputy is referring to the OECD Economic Outlook No. 43, June 1988. The Outlook points out that the current international economic situation is better than had been expected some months ago. The October stock market crisis does not appear to have had lasting effects on business confidence. OECD activity grew by 3 per cent in 1987 and expansion should continue with only a moderate loss of momentum this year and next. Inflation is under control and the international external imbalances are narrowing. World trade is expected to continue growing strongly.
I welcome the more optimistic economic forecasts contained in the OECD Economic Outlook. General economic data available since the Outlook was produced lend support to the more favourable growth prospects. In addition, the recently published US April trade figures were better than had been expected. They indicate that the reduction in that country's large external deficit, the main risk to international economic growth, is being maintained.
In the country note on Ireland the OECD refer to the several positive developments in the Irish economy last year, notably the significant export growth, the emergence of a surplus on the external current account, the substantial lowering of interest rates and the reduction in inflation and the budget deficit.
The OECD forecast a continuation of these trends in 1988 and 1989. Export growth is projected to remain strong, reflecting rapid market growth and what the OECD acknowledge as Ireland's good competitive position. The external account is projected to improve further and inflation is forecast to stabilise at around 2¾ to 3 per cent. The OECD expect positive, if modest, GNP growth in each of the two years despite the effects of continued fiscal restraint on domestic demand.
The Programme for National Recovery listed net emigration as one of the difficulties confronting us. The programme estimated it at close to 30,000 a year. This is the same figure as is given in the OECD's report. The central objective of the Government's economic and social policy as set out in the Programme for National Recovery is to create a sound basis for secure and sustainable growth in output and employment over the years ahead. The developments outlined in the OECD Economic Outlook clearly indicate that the environment for sustainable growth is being created by the policies pursued by the Government over the last 15 months. This is the only viable basis on which we can proceed to achieve an improvement in economic growth and employment prospects thereby reducing unemployment and involuntary emigration.
The OECD state that private sector employment may show some recovery. The latest information available suggests that the trend in private sector employment is responding to the improvement in the economic situation. This is partly reflected in the recent sharp decline in the Live Register numbers.