Finance Dept forecasts economic growth of 7.5% by end of 2018, but issues Brexit warning

Finance Dept forecasts economic growth of 7.5% by end of 2018, but issues Brexit warning

New economic figures from the Central Statistics Office show continuing growth.

The latest CSO national accounts indicate that GDP grew by just under 1% in the three months to the end of September.

Year on year, the economy has grown by nearly 5%.

The Finance Minister Paschal Donohoe has said Ireland is on track to achieve growth of 7.5% by the end of the year.

However, he has warned of the risks associated with Brexit, and international trade wars.

Mr Donohoe said: “While the headline GDP figures can overstate activity in the Irish economy, domestic measures such as modified domestic demand clearly indicate that the economy continues to perform strongly.

“In particular, I note the continued robust consumption growth of almost 3% and continued double-digit growth in building and construction investment, of which investment in housing grew by 26%, reflecting the continued efforts of the Government to increase housing supply.

“The strength of the domestic economy is also reflected in employment growth of 3% in the third quarter, as well as tax receipts to end-November which increased by 7.6% compared to the same period last year.

“My Department forecast real GDP growth of 7.5% for this year in Budget 2019. Today’s numbers are consistent with this projection."

“While the economic situation remains favourable at present we must remain vigilant. The Irish economy faces a number of significant risks, in particular, the potential fallout from Brexit, with the probability of a no-deal Brexit having risen of late, as well as increasing trade protectionism and potential overheating as the economy approaches full employment. Careful management of the public finances is needed in order to chart our way forward through the uncertain times ahead.”

It comes as the Society of the Irish Motor Industry (SIMI) joined IBEC in calling for a ramp-up of the State’s preparation for a No-Deal Brexit, including the implementation of Emergency Legislation that will be needed before the end of March 2019.

Brian Cooke, SIMI Director General Designate, said: “Over the past two years our Industry has faced this huge flood of older UK cars that has been hugely damaging to business and will make our environmental challenges even more difficult.

"So long as there was hope of an agreement, that would benefit Ireland overall, SIMI was not calling for the introduction of barriers on the movement of used cars which could have been seen as a first step in the building of a border on this island.

"In the event of a No-Deal Brexit all of this changes and the State has a responsibility to protect Irish jobs, businesses, tax revenues and our environment.

"It is a question of survival for so many businesses in the Sector that the State must be Brexit-ready with required legislative provisions already in place in advance of March 29th in the event that we move immediately into No-Deal Brexit.”

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