The Strategist

Ireland to contribute over €6 billion annually to two sovereign funds

10/11/2023 - 09:20

Ireland intends to finance two sovereign funds, one of which is intended to sustain the economy in the case of a potential crisis, with over €6 billion in budget receipts per year.

Ron Cogswell
Ron Cogswell
Ireland's budget surplus of 2.9% of GDP was achieved last year as a result of rising business tax receipts from European operations of numerous significant American corporations, such as Apple Inc., Microsoft Corp., and Pfizer Inc.

Irish Finance Minister Michael McGrath announced on Tuesday that the government plans to support the Future Ireland fund with an annual contribution of €4.3 billion, or 0.8% of nominal GDP, from 2024 to 2035. The Financial Times reports that the fund may be utilized for health care and pensions, as well as decarbonization and digitization projects.

If the government's resources yield an approximate 4% annual return on investment, it anticipates this fund to reach about €100 billion by 2035.

The Irish government intends to invest €2 billion annually through 2030 inclusive on infrastructure and climate projects through the second fund.