Vol. 486 No. 1
521 Mr. Allen asked the Minister for Finance the assessment, if any, which he has carried out of the impact of the economic crisis in southeast Asia on the Irish economy; and the discussions, if any, which have taken place with other European Finance Ministers regarding this matter. [1184/98]
Assessments carried out by my Department into the possible impact on the Irish economy of the continuing economic and financial situation in Asia indicate that the exposure of the Irish economy is limited at the present time.
The primary channels through which developments in Asia could extend outside of the region are through their impact on trade performance and investment flows. The Irish economy's exposure to the current situation in Asia in each of these areas is small.
As regards trade, the current turbulance in the Asian markets should not have any significant direct impact on Irish exports reflecting the small share of our total merchandise exports going to this region while there could be some drop in the price of imports coming from the region.
In relation to investment there is not expected to be a significant impact on the level of foreign direct investment in the Irish economy as a result of the difficulties in Asia since investment from Asia into the Irish economy only constitutes a small proportion of total FDI flows into the economy.
Both the IMF and OECD are forecasting a small slowdown in EU growth as a result of the ongoing problems in Asia. If these forecasts prove correct the impact of the Asian crisis on the Irish economic performance overall in 1998 will be correspondingly small. However, the situation in Asia is still evolving and I will keep it under review in conjunction with the European Finance Ministers.
