• Thu. Jun 13th, 2024

ESRI Predicts Solid Growth for Ireland’s Domestic Economy, Addresses Infrastructure Bottlenecks

BySamantha Johnson

Mar 27, 2024
Ireland’s economy expected to experience growth over the next two years

Ireland’s domestic economy is expected to see solid growth in the next two years, with modified domestic demand (MDD) predicted to increase by 2.3% this year and 2.5% next year, according to the Economic and Social Research Institute (ESRI). 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. Despite recovering strongly from the pandemic, the Irish economy slowed significantly in 2023 due to 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 plays a crucial role in economic growth and stability.

Gross Domestic Product (GDP) is typically used as a measure of economic performance but is heavily distorted by multinational activities in Ireland. In 2023, Irish GDP shrank by 3.2%, reflecting the impact of US pharmaceutical firms coming off their pandemic highs. The ESRI anticipates that there will be a rebound in Irish GDP over the next two years as global trade improves.

The think tank emphasized addressing infrastructure bottlenecks as a critical challenge for Ireland’s economy moving forward. This includes issues related to housebuilding, renewable energy, and public transport such as plans for an underground rail link between Dublin Airport and the city center which have been ongoing for over 20 years.

By Samantha Johnson

As a dedicated content writer at newsanguinely.com, I weave words into compelling stories that captivate and inform our readers. With a passion for storytelling and a keen eye for detail, I craft engaging articles that shed light on the latest news and trends. When I'm not typing away at my keyboard, you can find me exploring new ideas, researching diverse topics, and striving to deliver content that resonates with our audience. Join me on this journey as we uncover the stories that matter most.

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