Today, the finance ministry of Ireland said that it has lowered its growth forecasts for both the current year and next year, in moves that “reflect a deterioration in key export markets.”
The economy of Ireland is forecast to expand by 3.9 percent this year and 3.3 percent next year, a reduction from the projections last October that amounted to 4.2 percent and 3.6 percent, respectively.
The ministry stated that the “external environment has become more challenging” since its earlier forecasts.
It stated: “From an Irish perspective, the pace of growth has slowed in key export markets, with a loss of momentum particularly evident in both the euro area and the UK.”
It added: “At the same time,” it said, “some domestic indicators have moderated in recent months.”
Even though the growth projections have been revised downwards, the ministry said that it was more optimistic regarding the budgetary position of the country. It currently predicts that the Irish state will run a surplus of approximately 0.2 percent this year, thanks to the “very strong performance of corporation tax” revenues.
In a statement, Paschal Donohoe, the finance minister of Ireland, stated: “Despite the less favourable external environment, the Irish economy remains in a strong position and this is paying dividends in the labour market where an additional 50,000 jobs are expected to be added this year.”
He added: “We cannot be complacent, however, as there are serious risks on the horizon, not least of which is the nature and timing of the UK’s exit from the European Union. It is absolutely vital that we continue to build up our fiscal defenses, so that we can continue to support the economy, and provide for society, if, and when, these risks materialise.”