Ireland’s Domestic Economy Slows to 0.5% Growth Rate, Undercut by Multinational Companies and Inflation

Ireland’s economy expected to experience growth over the next two years

In 2023, Ireland’s domestic economy saw a slow growth rate of just 0.5%, as inflation and higher interest rates affected spending and investment. This was due to the impact of multinational companies on Ireland’s economy, which is heavily distorted by their activities. The Economic and Social Research Institute (ESRI) has predicted that Ireland’s domestic economy will see solid growth in the next two years, with modified domestic demand (MDD) expected to increase by 2.3% this year and 2.5% next year. MDD is a measurement that eliminates the impact of multinational companies on Ireland’s economy, providing a more accurate representation of domestic economic activity.

Inflation and higher interest rates affected spending and investment in 2022, leading to a slow growth rate of just 0.5% for MDD. The economy recovered strongly from the pandemic but slowed significantly in 2023, with higher inflation putting a strain on households and limiting real pay growth. Real pay, adjusted for inflation, is an important measure of changes in living standards, and it is essential for economic growth and stability.

The think tank highlighted the importance of addressing infrastructure bottlenecks as a critical challenge for Ireland’s economy moving forward. This includes issues related to housebuilding, renewable energy, and public transport. For example, plans for an underground rail link between Dublin Airport and the city center have been in the works for over 20 years, underscoring the need for timely and efficient infrastructure development to support economic growth and prosperity in Ireland.

In 2023, Ireland’s domestic economy saw a slow growth rate of just 0.5%, as inflation and higher interest rates affected spending and investment. This was due to the impact of multinational companies on Ireland’s economy, which is heavily distorted by their activities. The Economic and Social Research Institute (ESRI) has predicted that Ireland’s domestic economy…

Leave a Reply