The Irish economy looks set to register another very strong year of growth in 2018, with the outlook remaining positive as well for 2019. However, it will see a number of significant challenges mainly from an international perspective.
This is according to the latest report from the ESRI, which highlighted the importance of the Brexit process to Ireland.
The research institute believes that a withdrawal from the EU which avoids any World Trade Organisation tariffs would leave the Irish economy’s growth at 3%, but a ‘No-Deal’ would see it only grow by 2.5% in 2019.
It estimates that, by 2030, the current proposed Withdrawal Agreement would see the overall GDP take a 3.9% hit.
As things stand, the ESRI has retained its forecast of 8.2% GDP growth for 2018. Ignoring Brexit, it expects a growth of 4.2% next year.
The ESRI added that, while Budget 2019 has led to increased expenditure on items relating to social housing, overall the package does increase the possibility of overheating in the domestic economy.
It expects a 4% rise in tax receipts next year, ahead of the government’s own predictions.
It also expects a ‘mild’ deficit in next year’s budget, where again the Government was expecting another balanced budget.
It has warned the government about relying on corporation tax, adding that average disposable incomes will be damaged by tax and benefit changes implemented in the Budget.
© 2018 Checkout – your source for the latest Irish retail news. Article by Aidan O’Sullivan. Click subscribe to sign up for the Checkout print edition.