The Minister for Finance Michael Noonan told the Institute of International Finance in Washington this afternoon that Ireland had experienced the severity of the global crisis more than most other countries due to the small open nature of its economy
He said he was keenly aware of the risks posed to the country in the current climate and acknowledged there was "much work to be done."
"These past three years have been very difficult for our citizens. However, in spite of the severe global pressures, recent economic data shows that Ireland has returned to significant levels of growth, albeit with sharply divergent sectoral trends," he said.
"On the one hand, the substantial improvements in both price and cost competitiveness that have taken place in recent years are standing to us, with solid export growth. On the other hand, the unwinding of previously accumulated imbalances is weighing on domestic demand, and will probably continue to do so for some time."
Mr Noonan said financial market sentiment towards Ireland had improved noticeably of late, as evidenced by the sharp decline in yields on Irish government paper.
"I wish to acknowledge the decision taken by our EU colleagues to lower the interest rate and to extend maturities on our EU loans as being a key reason for this reduction," he said.
"The Government's key objective is to build on the positive momentum by returning our fiscal position to a sustainable balance over the coming years. To this effect, the Government will shortly be publishing a medium term fiscal consolidation path so as to provide greater certainty and direction for householders and businesses alike."
He said the Government had a "very strong mandate" from the Irish people despite their having had to make sacrifices in terms of higher taxes, lower levels of pay, and reductions in public services.
"These adjustments have on the whole been accepted by the people as they understand that, like them, the State must live within its means," he said.
Mr Noonan said international investor confidence in the Irish banking sector was being rebuilt through measures such as recapitalisation and merging and restructuring.
"Ireland is in the process of learning how difficult it is to re-establish financial and fiscal creditability. I hope others can learn from our actions."