OECD Economic Surveys

Despite GDP volatility driven by some multinational-dominated sectors the domestic economy remains robust thanks to strong labour market performance but risks have risen. Fiscal prudence is required to address spending pressures from ageing infrastructure gaps climate change and housing investment. Enhancing the fiscal framework boosting spending efficiency and diversifying tax revenues would improve long-run fiscal sustainability. In the context of a rapidly increasing population and rising capacity constraints addressing investment needs requires effective prioritisation and sequencing across sectors and type of projects. Reducing labour and skills shortages lowering legal costs and further easing administrative burdens on businesses would help maintain cost competitiveness. While Ireland has well-developed climate change mitigation and adaptation frameworks a shift from planning to implementation is needed. Recent policy measures have spurred housing completions but continued imbalances between housing supply and demand reflect structural impediments to a well-functioning housing market. Reforming the tax system to ensure its neutrality across housing tenure types and increase the supply of serviced land improving the planning and permitting process increasing housing density and lowering costs and improving productivity in the construction sector are key to boosting housing supply. Ensuring adequate supply and funding for the construction and operation of social housing should also be prioritised.