Exports dip, but surplus up 3%

EXPORTS dipped 6% in March on a seasonally adjusted basis after a sharp increase in February.

However, the economy continued to grow its trade surplus, according to the latest monthly figures issued yesterday by the Central Statistics Office.

That positive outcome was due to an even bigger fall in imports that were down 14% on March 2010.

That resulted in the country’s trade surplus increasing by 3% in March to €3,925m, the CSO figures show.

Unadjusted, they show exports grew in value by 8% in March compared to €8,455m to the same month last year.

This is the highest exports figure since May 2002 when the value of exports was €9,122m. The value of imports on an unadjusted basis was down 3% to €4,095m.

In the first two months of 2011 exports increased by 6% to €14,542m compared to the same two months last year.

Exports of organic chemicals rose 12% with medical and pharmaceutical products up by 10%, according to the CSO.

Exports of electrical machinery on the other hand fell by 16%.

The figures again demonstrate exports will be the key to growth in the economy in the coming years, a fact recognised earlier in the week by the European Commission in its review of progress by Ireland under the terms to the EU/IMF bailout.

The review said the economy was currently linked to declining internal demand due to weak consumer demand and falling investment while exports, both domestic and international, have continued to make solid progress in overseas trade for the most part.

Exports to the US increased 20%, or €598m, and to Britain by 18%, or €314m.

In a comment yesterday the Irish Exporters Association said it expected trade with Britain to increase significantly as a result of the visit of Queen Elizabeth to Ireland in the past few days.

John Whelan, chief executive of the IEA, said that in 2010 the UK, our largest export market for goods and services grew to €27.8 billion, but that was off the high point of €30 billion reached in 2007.

While export sales have been falling since that time “we are confident that the state visit from the UK will re-position Ireland and Irish products and services in a more favourable light in the hearts and minds of UK consumer , and will boost our exports above the €30bn level this year,” Whelan said.

Davy Research said the figures offered “some very tentative evidence that exports picked up in Q1.

“The country’s progress in achieving “external balance ahead of other peripheral economies will help the economy to cope with fiscal consolidation,” the broker said.