Monday , August 15 2022

The OECD warns that economic growth will decline by 2020


Pascal Donohoe. Photo by Collins Dublin, Gareth Chaney
Pascal Donohoe. Photo by Collins Dublin, Gareth Chaney

Economic growth is slowing, and the government has to consolidate its financial reserves as risks such as Brexit and possible changes to the international tax regime.

The warning came from the Organization for Economic Cooperation and Development (OECD), a group of the richest economies in the world.

According to a report on the global economy, economic growth in Ireland will slow down to 3.4% by 2020, from 7.2% this year, much faster than in the rest of the euro area, supported by domestic demand strong and rising wages.

"The tax position will not improve much in the next two years," said the Paris agency.

"The government should remain committed to improving its fiscal stance, but be ready to ease fiscal stance to mitigate the impact of a potentially disordered conclusion on Brexit's negotiations," he warned.

In his budget, Finance Minister Paschal Donohoe set aside 500 million euros for a rainy rainfall fund and the government plans to take Brexit. However, the Parliamentary Budget Bureau warned that the projections were "based on the assumption of a" ordered "Brexit.

The International Monetary Fund said last week that an uncommitted brexit, an increasingly likely outcome, could eliminate three percentage points from the perspective of Ireland's economic growth.

However, Mr Donohoe's budget proposals have outpaced spending, even though the amortization tax revenues filled the government's courier and plans for a budget surplus were backed back.

Ireland desperately needs more infrastructure spending, but spending in other areas has continued to increase, suggesting funds. The latest figures in October showed that spending grew by 9.2% to 40.1 billion euros, much faster than revenue.

Irish Independent

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