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Investing.com -- S&P Global Ratings has affirmed Ireland’s ’AA’ long-term and ’A-1+’ short-term sovereign credit ratings, maintaining a positive outlook.
The rating agency cited Ireland’s significant fiscal overperformance and high corporate tax receipts that are rebuilding government fiscal buffers. The positive outlook also reflects sustained economic growth and external resilience of the Irish economy.
Ireland achieved a government surplus of 7.2% of modified gross national income (GNI) in 2024, boosted by one-off back-tax collection from Apple worth 4.6% of GNI following a European Court of Justice ruling in September 2024.
Corporate tax receipts have become increasingly important for Ireland’s budget, now accounting for almost 30% of total tax revenue. The tax base is concentrated, with 57% of corporate tax receipts coming from just 10 companies, and approximately one-third from the top three firms alone.
S&P expects Ireland’s economy to grow by 1.9% in 2025, with average growth of 2% projected for 2025-2028. While lower than Ireland’s recent performance, this remains above the eurozone average forecast of 1.2% for the same period.
The recently concluded EU-U.S. trade deal has provided near-term certainty for Irish exporters, with a maximum tariff rate of 15% for most European export sectors. Pharmaceutical products, which constitute 63% of Ireland’s total exports to the U.S., are currently undergoing Section 232 investigations by the U.S., but S&P doesn’t expect a potential 15% tariff would fundamentally undermine these firms’ presence in Ireland.
Goods exports grew by 41% in the first half of 2025, almost entirely due to more than doubled exports to the U.S., partly reflecting frontloading ahead of potential tariffs and a new blockbuster weight-loss drug factory line in Cork.
S&P could raise Ireland’s ratings in the next 24 months if the country continues to rebuild economic and fiscal buffers, improving resilience to external shocks. Conversely, the outlook could be revised to stable if U.S. trade policy or other global developments undermine Ireland’s economic prospects more than expected.
The rating agency noted that Ireland’s efforts to address infrastructure bottlenecks, particularly in housing, water infrastructure, electricity grid, and transport, will be key to supporting longer-term competitiveness and expanding real incomes.
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