Finance | Necessary economic fundamentals met in Budge 2023
To ask the Minister for Finance the extent to which the necessary economic fundamentals continue to be met and will so do in the coming year in the aftermath of Budget 2023 or otherwise; and if he will make a statement on the matter.
Prior to the pandemic, the economic fundamentals of the Irish economy were in a strong position, with robust growth, a labour market close to full employment and public finances broadly balanced. From this position of strength, and with the aid of government policies, the Irish economy proved to be remarkably resilient during successive lockdowns and emerged from the pandemic, at the start of this year, with little evidence of permanent scarring to the economy.
Our economy is now faced with new challenge and significant headwinds as a result of the war in Ukraine, the most pressing of which has been the rising cost of living. Consumer price (HICP) inflation rose to 9 per cent in August. Rising prices are eroding real incomes of Irish households and inhibiting businesses investment. The Government is acutely aware of these challenges and is committed to tackling them head-on. As part of Budget 2023 next week, the Government will set out a series of targeted once-off measures to be introduced over the course of the winter to help alleviate the cost of living pressures on both businesses and households.
Notwithstanding these challenges, the economic fundamentals of the Irish economy remain strong. The labour market has remained resilient, with a record number of people now in employment and the unemployment rate falling to just 4.3 per cent in August. The external side of the economy also continues to perform very strongly with particularly strong export growth in the ICT and Pharmaceutical sectors.
Whilst our economy has faced a successive wave of shocks over the last number of years, our resilience and strength ultimately comes from being a dynamic economy open to investment and trade across our borders. This has long proven to be the fundamental strength of the Irish economy, and that remains the case today.
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