Bernard Durkan
Question:216. Deputy Bernard J. Durkan asked the Minister for Finance the degree to which Ireland remains competitive both within and without the European Union; and if he will make a statement on the matter. [43442/23]
View answerThursday, 5 October 2023
Questions (216, 223)
Bernard Durkan
Question:223. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which he remains satisfied with the performance of Ireland's economy when compared to all others in the eurozone; and if he will make a statement on the matter. [43449/23]
View answerWritten answers
I propose to take Questions Nos. 216 and 223 together.
Economic growth prospects across the Eurozone, the European Union and more broadly remain subdued. In the second quarter of this year, GDP grew by just 0.1 per cent in the Eurozone and was flat in the EU. Irish GDP, by comparison, increased by ½ a per cent in the second quarter, while modified domestic demand – my preferred measure of domestic economic activity – increased by 1 per cent over this period, driven largely by the strength of consumer spending.
There remains significant uncertainty surrounding the outlook for the international economy, and Ireland is facing many of the same headwinds as our European peers. Although headline inflation has eased in many economies, core inflation is proving more persistent. Growth in the Chinese economy has moderated recently, with potential spillovers for the global economy if there is continued weakness in Chinese economic growth, while a further heightening in geopolitical tensions would have negative implications for global trade.
Looking ahead, global GDP growth is projected to remain subdued this year and next. In its recent interim economic outlook, the OECD is projecting historically weak global GDP growth of just 3 per cent in 2023, while euro area GDP is forecast at 0.6 per cent - a marginal downward revision - driven by the German economy which is now forecast to contract by 0.2 per cent.
As a small, open economy, Ireland is particularly exposed to risks in the global economy. However, the Irish economy has proven resilient, and is on a strong footing to face future potential headwinds. The Government will continue to monitor the risks to Ireland’s competitiveness. My Department will publish updated projections next week alongside the Budget.