Press release
Ministers Donohoe and McGrath Welcome IMF assessment of Irish Economy
From Department of Finance; Department of Public Expenditure, NDP Delivery and Reform
Published on
Last updated on
From Department of Finance; Department of Public Expenditure, NDP Delivery and Reform
Published on
Last updated on
The Minister for Finance, Paschal Donohoe TD, and the Minister for Public Expenditure and Reform, Michael McGrath TD, today welcomed the publication of the IMF’s annual review of the Irish economy, the Staff Report for the 2022 Article IV Consultation .
The Report sets out the views of IMF staff on the current position of the economy and identifies key structural factors that will have a bearing on domestic living standards in the year’s ahead. The Report also makes a number of policy recommendations. The Fund acknowledges that the Irish economy has rebounded strongly from the pandemic, but notes mounting headwinds, including spill-overs from the war in Ukraine.
Commenting on the Report, Minister Donohoe said:
“I welcome today’s publication by the IMF, and its assessment that our economy has weathered the pandemic well. This annual report by the Fund is a very useful economic stock-take, and helps shed light on our relative strengths and weaknesses.
“I note the Fund’s assessment of possible future challenges, notably higher-than-assumed price inflation and the economic fall-out from war in Ukraine. In the Summer Economic Statement published this week, the Government also recognised these risks to our economy.
“In relation to inflation, the Government has responded swiftly and forcefully to mitigate the burden on households and businesses, with fiscal supports amounting to €2.4 billion.
“I would highlight the Fund’s view that the stance of budgetary policy for this year is broadly appropriate.
“Finally, I share the Fund’s assessment of key structural issues, such as the need to further increase housing supply and to continue to implement measures to address climate change. These are priority areas for Government, and we are working hard to address these important issues.”
Minister McGrath said:
“I welcome the IMF team’s engagement with my Department throughout their recent two-week mission visit. The publication of their annual review presents a timely opportunity to consider the ongoing developments in our economy.
“Recent months have seen a number of new challenges emerge across the economy. In recognition of the resulting inflationary challenge, the Government has committed significant resources for cost of living measures, targeted at the main underlying problem of higher energy prices and with additional assistance to those most vulnerable.
“In the recently published Summer Economic Statement, we have outlined our budget strategy for 2023 and have sought to strike a balance between helping to mitigate cost of living pressures, delivering continued investment in public services and ensuring sustainability of the public finances.
“The IMF has highlighted the scope for high-quality spending to facilitate the transformation of the economy while safeguarding fiscal sustainability. Recent expenditure reforms, including the spending review, performance budgeting and the wellbeing framework, are key tools to ensure spending delivers efficiency, effectiveness and value for money.”
ENDS
Notes for Editors:
The Article IV process is a requirement for all members of the Fund and takes place on a periodic, usually annual, basis. It is a long-standing element of Ireland’s regular engagement with the IMF and has a medium- to long-term focus. This year’s review took place from 26 April to 5 May.
During an Article IV Consultation, IMF economists visit a country to discuss the country's economic and financial policies with government and central bank officials, as well as a range of public and private sector stakeholders. The team reports its findings to IMF management and then presents them for discussion to the Executive Board, which represents all of the IMF's member countries. A summary of the Board's views is subsequently transmitted to the country's government. In this way, the IMF aims to ensure that the views of the global community and the lessons of international experience are brought to bear on national policies. Summaries of most discussions are released in press releases and are posted on the IMF website , as are most of the country reports prepared by the staff.
The 2022 IMF Article IV Consultation involved a small team of IMF staff visiting Ireland for a two-week period, during which they met the Minister for Finance, the Minister for Public Expenditure and Reform, the Central Bank Governor, officials from various government departments and agencies, as well as a range of public and private sector organisations. .