Ireland under pressure on meeting fiscal bailout goal

WEAKENING domestic demand and the threat of a European recession risk undermining Ireland’s hopes of meeting its medium-term fiscal goal under an EU-IMF bailout, a Reuters poll showed yesterday.

Ireland has vowed to get its budget deficit — the worst in the industrialised world — under a European Union limit of 3% of Gross Domestic Product (GDP) by 2015 by implementing around €33 billion in cutbacks and tax hikes, equivalent to around a fifth of annual economic output, over eight years.

But the median estimate of nine economists polled by Reuters is for the deficit to fall to 3.2% of GDP compared to 2.9% in the previous poll, which is the current government target.