Exports near €8bn as surge continues
Saturday, September 15, 2012
Exports continued to surge in July, reaching €7.9bn, which was a 6% increase on the previous month.
There was a marginal decline in seasonally adjusted imports over July, which meant the trade surplus for the month rose by a seasonally adjusted 12.6% to €3.9bn.
The export sector has performed robustly over the past few years, helping the economy to record a trade surplus in 2011. For the first seven months of the year, exports reached €54.3bn while imports have come in at €28.8bn, which leaves a trade surplus for the year to date at €25.5bn.
Enterprise and Jobs Minister Richard Bruton said: "The Government is implementing its plan to rebuild an economy based on enterprise and exports, and the transition from the old, failed economy based on property and debt is well underway.
"Total exports achieved a record €173bn last year, a 10% increase on the highest pre-crisis figure. Employment in the exporting sectors started to grow in 2011 for the first time after three years in which 40,000 jobs were lost, and the multinational exporting sector has shown an increase of 9,000 jobs since then."
Pharmaceuticals continues to be the backbone of the overall export market — accounting for €4.9bn, or 62% of all exports, over July, which was a 15% increase on June levels.
The EU is Ireland’s biggest market — soaking up 57% of total exports in July. Britain and Belgium account for 30% of these exports.
Outside the EU, the US is Ireland’s next biggest trading partner at 23%. The EU accounts for 60% of all imports with Britain accounting for half of these.
Merrion Stockbroker economist Alan McQuaid warns that even though exports will be the key driver of the economy at least over the near to medium term, there are downside risks in view of the deteriorating global economic backdrop, particularly among Ireland’s main trading partners.
"Another concern relates to the sustainability of the positive contribution from the pharmaceuticals sector," he said.
"Output from this area tends to be quite erratic at the best of times due to company-specific developments in patents and product cycles, but it is worth noting that a substantial part of the sharp decline in the value of overall exports last December was due to the high value cholesterol treating drug, Lipitor, coming off patent, something that is likely to be repeated in other pharmaceutical products going forward."
Mr McQuaid argues that overall export growth in 2012 looks set to be weaker than in 2011.
"We are forecasting an overall volume increase of 4% in goods and services, rising back up again to 4.5% in 2013, all things being equal, though with services rather than merchandise the main driver."