Micheál Martin: Irish spending plans at risk from 'global shocks' of Trump and war
Way' 'if External Will Adapted Leah To Shocks Be Picture: Fianna Leader Said And E Martin Plans Tánaiste Farrell Our Fáil Have Micheál
The spending plans being sold to potential voters by political parties may all have to be revised thanks to Donald Trump's choices for his incoming cabinet, the Tánaiste has said.
All of the manifestos published by parties so far are based on Department of Finance projections that at least some of the windfall corporation taxes will continue.
However, the incoming US president's choice of commerce secretary Howard Lutnick has targeted some of the taxes which come from US firms.
In October, Mr Lutnick wrote on X that America can only “become a great country again” if Ireland stops “running a trade surplus at our expense”.
Scroll for results in your area
President-elect Mr Trump has pledged to slash corporate tax rates to Irish levels as well as roll out incentives for industries to bring production back to the US.
That could have a major impact on growth forecasts already published.
Micheál Martin told the that Mr Lutnick's appointment may mean that parties' spending plans have to change.
"It puts all manifestos [in a new light]. All manifestos are predicated on the existing economic assumptions that the Department of Finance has published.
"In the Middle East, if an Iranian-Israeli war started that could have catastrophic impact on oil supplies and energy costs and that would disrupt the global economy.
"Likewise, if a new American administration goes down a protectionist route and develops a tariff framework, that could damage our exports to the US. It could damage [exports] to China."
Mr Martin said the US following a protectionist route "might not be in its own best interests".
He said president Joe Biden's protectionism around covid vaccines was "not a very bright idea".
"We will have to wait and see the degree to which companies will endeavour to moderate what's happening in American policy and the development of American policy.
"But the world as a whole is becoming more protectionist, and that is a worry for Ireland because we're a small, open economy.
"We export most of what we produce. So by definition, if protectionism develops, if more tariff wars develop, those are big threats to the Irish economy."
Ireland exported around €63bn worth of goods to the US in 2022, more than any other country, meaning that tariffs could be particularly damaging to the Irish economy.
Both Fianna Fáil and Fine Gael's manifestos have pledged to increase spending by between 5.5% to 7% a year by 2030, cut taxes, and invest the remaining surplus in the country's sovereign wealth fund.
Fine Gael's manifesto proposes increasing spending by €52bn between next year and 2030.
Taoiseach Simon Harris has rejected the idea that his party's spending plans are reckless.
Fianna Fáil's plan would add around €60bn over the next five years.
The coalition government has repeatedly broken its own rule limiting additional spending to 5% a year, citing extraordinary factors such as inflation.
Public Expenditure Minister Paschal Donohoe on Wednesday said Mr Lutnick's nomination was a reminder of the need to protect budgetary surpluses and to put money in rainy-day funds.
On Wednesday, Mr Martin joined Fine Gael in criticising Sinn Féin's economic plans.
It came as Sinn Féin's Pearse Doherty accused Paschal Donohoe of a "bare-faced lie" over an attack ad Fine Gael has launched.
The Public Expenditure Minister has accused Sinn Féin of wanting to "raid the public piggy bank" and take money from the two rainy-day funds.
Mr Doherty says his plan would add €15bn to the funds.
Mr Martin said the Sinn Féin plan is "sailing close to the wind" by allowing for surpluses of over €1bn a year.
He said that were there to be any shocks, Sinn Féin would find itself "in deficit territory very quickly".