Bernard Durkan (Kildare North, Fine Gael)
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199. To ask the Minister for Finance if he is satisfied that economic progress will continue; if the cost base is and will remain competitive; and if he will make a statement on the matter. [9762/16]

Michael Noonan (Limerick City, Fine Gael)
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As I have already said to this House last month on the presentation of the Stability Programme Update, I am greatly encouraged by recent data showing that the recovery is gaining momentum.  The Irish economy is growing at the fastest rate in Europe - with growth of 7.8 per cent recorded in 2015 and my Department's forecast is that the economy will grow by 4.9 per cent in 2016. Furthermore, over the remainder of the forecast horizon out to 2021, potential growth rates are forecast to average around 3.5 per cent per annum.

Importantly, the expansion in economic activity, initially led by the exporting sectors, has broadened with growth now increasingly driven by domestic factors. This is crucial as domestic sectors are both jobs-rich and tax-rich.

Meanwhile, the external sector remains strong with exports increasing by 13.8 per cent in 2015. The competitiveness gains achieved since 2008 have been the result of productivity improvements and wage and price moderation. It is important that these gains are maintained, to support continued growth through both foreign direct and indigenous investment.

The recovery is most clearly evident in the labour market where we have now seen thirteen successive quarters of employment growth. In 2015, employment increased by 2.6% - representing an additional 50,000 jobs. As a result, the latest data show the unemployment rate has fallen to 8.4 per cent at the end of April, the lowest level since 2008.  

The SPU recognises that there are nevertheless several sources of uncertainty at present. In particular, there is uncertainty surrounding the continuing economic slowdown of several Emerging Market Economies (EMEs) and the effect this will have on the global economy. Additionally with the forthcoming referendum on the UK's membership of the European Union on the horizon, Ireland is potentially more exposed than most to a UK exit.

This uncertainty highlights the importance of prudent management of the public finances and of competitiveness-oriented policies that would help the Irish economy to weather any global economic downturn that may emerge.

In summary, I am confident that significant economic progress can continue to be made in the years ahead. However, this is contingent upon implementing appropriate polices. That is what the Government intends to do.