European Interest

Ireland finance minister discusses country’s economy against backdrop of war in Ukraine

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Paschal Donohoe, Ireland’s finance minister, on Wednesday discussed with MEPs about the economic situation of Ireland and Ireland’s position to upcoming EU legislation and reforms.

Addressing the economic and monetary affairs committee, Mr Donohoe explained that his country’s growth projections had been reduced downwards by 2 ¼ points as a result of Russia’s war in Ukraine and the ensuing hike in energy and commodity prices. Growth however was expected to be at around 4%, although such projection was dependent on the war. With the prevailing uncertainty, the margin of error remained significant and the balance of risks tilted to the downside, Mr Donohoe added.

MEPs primarily sought to obtain clarity on Ireland’s position about the reform of the stability and growth pact, completion of the banking union, the minimum tax directive, the Unshell proposal, which aims at better regulating the use of shell companies, and the possible creation of a permanent budgetary capacity within the EU, similar to the recovery and resilience facility. They also wanted to know how the spike in inflation was affecting Ireland, and how the country was addressing the social dimension of the war-induced crisis, notably regarding energy poverty. Questions were also asked about the country’s cost of housing, its borrowing needs in the years to come, and its debt reduction strategy.

This was the fourth such meeting, following similar meetings with finance ministers from Cyprus, Spain and Greece. Other similar meetings are scheduled with the finance ministers of Romania and Portugal.

You can watch the meeting again here (scroll to 11.00 on the time bar)

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