The economic outlook has improved markedly. Exceptionally strong net exports made Ireland the fastest growing economy in the EU in 2014. Although the contribution from net exports is likely to moderate, strong investment growth and the recovery in private consumption – which has remained subdued so far – should underpin real GDP growth in 2015 and 2016. The recovery has been job-rich although the unemployment rate remains high. The better macroeconomic environment has helped achieve fiscal targets despite expenditure overruns, and the fiscal position is expected to improve further in 2015, though some risks remain. Inflation remains subdued. Bank performance has continued to improve but there are still considerable difficulties.
Ireland is experiencing macroeconomic imbalances, which require decisive policy action and specific monitoring. Ireland completed the EU-IMF financial assistance programme in 2013 and is currently subject to post-programme surveillance and European Semester surveillance. Despite a marked improvement in the economic outlook, risks related to the high levels of private and public sector indebtedness; remaining financial sector challenges, in particular with regard to the banks’ profitability, and labour market adjustment marked by high structural unemployment, continue to deserve close attention.
Read a complete analysis of Ireland's economy in the country report 2015 [2 MB]
2015 recommendations in brief
The Commission has made four country-specific recommendations to Ireland to help it improve its economic performance. These are in the areas of: public finances and taxation; health; labour market and poverty; financial sector.