CSO figures will confirm record rate of growth in Irish economy last year
FIGURES out today are expected to show that the economy grew at a record pace last year. The Minister for Finance, Mr Quinn, said yesterday that the economy could have grown by as much as 8 per cent last year, five times the EU average.
The Central Statistics Office is to publish its 1996 economic estimates today. While Mr Quinn said he had no advance knowledge of the CSO figures, the Department of Finance's internal assessments show that previous growth estimates for last year were too low.
The Department previously estimated economic growth measured by the rise in Gross National Product - at 7.25 per cent last year, just below the 7.3 to 7.4 per cent growth rates achieved in the previous two years. However, today's figures are expected to show that growth last year surpassed this setting a new record.
The rise in tax revenues was one key factor pointing to stronger economic growth last year, according to Mr Quinn, who was addressing an Irish Farmers Association conference on monetary union. There was already strong speculation that the CSO estimate for economic growth would be "higher than was previously thought to have been the case", he said.
The Irish Times revealed last week that the latest Department of Finance internal forecasts indicated economic growth of 6.5 per cent this year, up from its 1997 Budget day prediction of 5.5 per cent. This will mean that tax revenues should come in some £500 million above forecast.
Today's figures are expected to confirm that economic growth in Ireland last year was the fastest in the developed world.
A report from the Organisation for Economic Cooperation and Development last week showed that even before today's upgrade in growth estimates Ireland was already the fastest growing economy among its 29 members last year. The OECD believes that Ireland will top the growth league again both this year and next.
Despite the strong growth, inflationary pressures remain subdued. Figures last month showed inflation running at 1.5 per cent this year leaving the economy benefiting from an unprecedented combination of low inflation and surging growth.
Mr Quinn said expectations of growth last year being about 8 per cent were "already in the public domain", although he did not know what today's CSO figures would show.