Jan O'Sullivan
Ceist:50 Ms O'Sullivan asked the Minister for Finance his Department's forecast of the level of economic growth for the current year; and if he will make a statement on the matter. [19046/01]
Vol. 539 No. 2
50 Ms O'Sullivan asked the Minister for Finance his Department's forecast of the level of economic growth for the current year; and if he will make a statement on the matter. [19046/01]
The Department last published an economic growth forecast at budget time in December 2000. At that time economic growth was forecast to increase by 8.8% in GDP terms and by 7.4% in GNP terms. Since the last budget there have been developments which are likely to negatively impact on the growth rate in 2001. The slowdown in the US economy and its repercussions for other world markets can be expected to have some effect on Irish exports and investment. The restrictions which were imposed to successfully contain the outbreak of foot and mouth disease can also be expected to have had some effect on economic growth, especially in the tourism and farming sectors.
Other commentators, having taken these factors into account, have revised their forecasts for economic growth downwards for 2001. My Department, as is the normal practice, will issue its revised forecasts with the publication of its Economic Review and Outlook later in the summer.
Question No. 51 answered with Question No. 37.
52 Mr. Noonan asked the Minister for Finance if he has received the OECD economic outlook report, published on 2 May 2001; and if he will make a statement on the matter. [15560/01]
I have a copy of the OECD Economic Outlook No. 69 which gives the OECD's view of all the member countries. The outlook points out that growth in the OECD area is expected to be 2% this year, half the rate achieved last year although this is expected to recover somewhat to between 2.5% and 3% next year. Slower growth across the OECD area, combined with an expected fall in the price of oil, should help keep inflation low. The recovery in growth which is projected for next year is based on factors such as the interest rate reductions which have already taken place and lower oil prices. The main risk to this outlook which the OECD identifies is a further substantial decline in the value of technology stocks which would adversely affect aggregate demand.