Irish trade surplus down 23%

Ireland’s trade surplus fell by 23% in December to its lowest level since July on the back of a marked difference in export and import performance during the month.

According to preliminary figures from the CSO, published yesterday, Irish export value fell by 9% on a monthly basis to €7.5bn in December, while import value jumped by 8% to just over €4bn.

This resulted in the sharp decline in the monthly seasonally-adjusted trade surplus, to just under €3.5bn (down from €4.54bn in November), the lowest level seen since July 2011’s surplus of €3.23bn.

That said, Ireland’s overall trade surplus for 2011 — a figure which will not be known until full December figures are released next month — is still expected to come in at around €45bn, which would be a record high, eclipsing the €43.4bn generated in 2010.

December’s export value decline was particularly affected by the chemical/ pharmaceutical sector and drugs — including Pfizer’s big-ticket cholesterol treatment Lipitor — coming off patent.

Chambers Ireland said the export figures highlight a need to focus on the domestic economy.

“These unstable export figures remind us that we must also focus on the domestic economy, and ensure that everything possible is done to strengthen it,” said Chambers’ deputy chief executive Seán Murphy.

“The reported increase in imports indicates that consumer confidence is rising and people are spending again,” he said. “These figures underscore the need for a resolute focus on cost competitiveness, with a view to supporting our international competitiveness, along with the delivery of promised reforms from the Government’s action plan for jobs.”

Yesterday’s CSO figures also show a good performance from Ireland’s export sector in the first 11 months of the year — with value up by 5%, year-on-year to €85.74bn. Over the same timeframe, import value increased by 6% to €44.14bn. There were healthy increases in exports to key markets such as the US, Britain and France.

“There is little evidence that the contraction in euro area GDP in the fourth quarter, is pushing down on demand for Irish exports,” according to Conall MacCoille, chief economist with Davy Stockbrokers.