€4bn trade surplus hits highest level for eight years

IRELAND’s trade surplus hit its highest level for eight years in April, as exports put in a strong showing.

On an unadjusted basis, the surplus – the value by which exports exceed imports – reached just under €4 billion, the second highest level on record. Measured on a seasonally adjusted basis it reached record levels at €3.86bn.

Exports had a 6% increase on March’s levels and a 5% rise measured against April last year. Imports fell 6% in April compared with March. In the first three months of the year, the value of exports was up by 2% year-on-year to €21.84bn. By the same measure, import values shrank 20% to €12.52bn. The good showing on the export front was driven by strong rises in medical/pharmaceutical and chemical product exports.

However, electrical machinery and computer equipment exports were down. The value of exports to the US rose 18% year-on-year in the first three months of the year, but there were big percentage falls to China, Germany and Britain. “Amid all the doom and gloom it is encouraging to report a bit of good news, with the external side of the economy holding up remarkably well. Given that the export side will be key to the Irish economic recovery going forward, the fact that exports remain strong despite a weak global economy augurs well for the future,” commented Alan McQuaid, chief economist at Bloxham Stockbrokers. National Irish Bank economist Ronnie O’Toole added Ireland has been almost alone amongst non-oil exporting countries in increasing export levels.

He attributed much of the performance to luck, but also to the strength of the country’s multinationals. Indigenous exporters are finding conditions tough, mainly due to a weak sterling against the euro.

“In part, this resilient export performance reflects good luck. Ireland has built up a large pharmaceutical industry which is close to recession-proof, and which now accounts for well over half of total goods exports. However, chance alone can’t explain this very strong performance. The Swiss economy has suffered a significant decline in exports, despite also having a large pharmaceutical base.

“The strong performance also reflects the underlying strength of Ireland’s multinational exporters...

“Ireland retains a lot of advantages as an exporting nation, particularly a highly skilled workforce, low corporation tax and a pro-business environment.”