There is nothing catastrophic on the horizon for Irish fiscal policy as a result of the UK's vote to leave the European Union, Finance Minister Michael Noonan said today.
But Mr Noonan said the hit to economic growth could limit budgets beyond next year.
"What I'm confident about is that we can plan the next budget and the one after with minimal effect and then there are a lot of circumstances that could change from then on out. There is nothing catastrophic for Irish fiscal policy on the horizon," Mr Noonan said.
The Minister said there may be actually some upsides for Ireland if companies keen to stay in the EU moved to Dublin from London.
A contingency plan published by the Government stated that it would intensify marketing efforts in key sectors, including financial services, for firms wishing to be based in the EU.
The Department of Finance said it has been actively preparing for the outcome of the referendum and has been liaising closely with the Central Bank and the NTMA to ensure financial and economic stability can be maintained.
"The prudent economic and fiscal policies implemented over recent years have placed the State in a stronger position to weather any prolonged economic shock that may be caused by this result," the department said in a statement.
"Today is the start of a process. The UK remains a full member of the EU and will continue to remain so until the arrangements for its withdrawal have been completed," Mr Noonan said.
"I would like to assure you that I will be working to ensure that throughout this process we will seek to support the continuation of the important and mutually beneficial economic ties that exist between the UK and Ireland," he added.
The Minister said that the Governor of the Central Bank had told him that the bank was confident the appropriate contingency measures are in place to address any immediate issues of financial stability that may arise.
"I also spoke this morning with the CEO of the National Treasury Management Agency. He confirmed that the NTMA has prepared for this as it is well funded for this year and our debt dynamics are improving," the Minister added.
