Strong economy provides platform for ambitious investment in Budget 2020

Ibec, the group that represents Irish business, today welcomed the continued strong performance of the Irish economy in the first half of the year. The group called on Government to ensure that the proceeds of this economic success are invested wisely to help protect the economy against gathering storm clouds. 

Commenting on the latest CSO data on economic growth, Ibec Director of Policy and Public Affairs Fergal O’Brien said: “From the perspective of the rear-view mirror, the Irish economy remains in great shape. The Q2 performance was again very strong, underpinned by solid consumer spending and business investment. Buoyant job creation and solid income growth have seen strong increases in household disposable income. This is reflected in the over 3% annual growth in consumer spending in the second quarter of the year. A much more eye-watering observation on the consumer economy in that period, however, was the 13% increase in spending by Irish holidaymakers on foreign trips.

“Outside of the consumer economy, output from industry grew strongly in the second quarter, in both the multinational sector and the more Brexit-exposed traditional manufacturing sector. There is some evidence in today’s data that the expansion in construction activity is reaching a plateau and, given the obvious continued shortage in housing stock, that is a concern for the wider economy.

“Overall, the economy continues to perform strongly and we expect to see GDP growth of at least 4% this year. As we look to 2020, however, weaker global growth and Brexit-related risks will most likely result in more modest growth. On the back of the latest data, we expect tax revenue to put in another very strong performance for this year. It is vital that the Minister for Finance invests these resources wisely through Budget Day decisions related to infrastructure, education and innovation, along with Brexit-related support measures for business.”