Vol. 530 No. 6
66 Mr. Durkan asked the Minister for Finance the measures he has taken to protect our economic future within the European Union with particular reference to the need to ensure this country remains competitive; and if he will make a statement on the matter. [4615/01]
207 Mr. Durkan asked the Minister for Finance the measures available to him to stimulate the economy in the event of an economic downturn; and if he will make a statement on the matter. [4957/01]
208 Mr. Durkan asked the Minister for Finance if he has satisfied himself that economic growth will continue regardless of the concerns expressed in some financial circles regarding the long-term economic prospects; and if he will make a statement on the matter. [4958/01]
209 Mr. Durkan asked the Minister for Finance if he expects current economic growth levels to continue; if remedial action is required to accelerate or decelerate; and if he will make a statement on the matter. [4959/01]
I pro pose to answer Questions Nos. 66, 207, 208 and 209 together.
The economy is continuing to expand rapidly. It is estimated by my Department that GNP expanded by 8.6% in 2000. This continues the exceptional period of growth experienced since 1995.
It is inevitable that the economy will slow in the medium term. The latest set of projections that I published on budget day forecast growth in GNP terms of 7.4% this year, 5.4% in 2002 and 5.1% in 2003. It is projected by my Department that the economy can sustain growth rates of 5% per annum in GNP terms in the medium term. This takes account of prospective changes in employment and productivity.
Others share this assessment of the economy's sustainable growth. The Economic and Social Research Institute, ESRI, in its most recent medium-term review anticipates a growth rate for GNP over the next five years of around 5% a year.
These projections assume that the international economy continues to expand and that a severe economic shock is avoided. Given the openness of the economy, we need to monitor external developments closely. The prudent management of economic and budgetary policy in recent years has put Ireland in a good position to cope with any external economic shocks.
Ireland's economic success in recent years has been achieved through our ability to improve our international competitiveness. To achieve the economy's growth potential this competitiveness must be maintained.
In 1996, the World Competitiveness Report ranked Ireland as the twenty second most competitive economy in the world. In 2000 Ireland was ranked seventh in the world. This improvement is due to a number of important factors, including the substantial investment in education and training in the last three decades; the implementation of the terms of successive national agreements, including the current Programme for Prosperity and Fairness, has delivered moderate pay increases which, when combined with tax cuts, gave substantial increases in real take home pay; the radical restructuring of the tax system which has improved incentives to work; and the ongoing reform of product and capital markets and the promotion of competition and market liberalisation.
The Government is committed to ensuring our economy remains competitive and thereby sustains continued economic growth.
