Domestic demand will strengthen the recovery

The growth in GDP has slowed considerably from the 2.2% recorded in 2011. Most forecasts are for Irish GDP to grow by 0.0% to 0.5% this year, after expanding by just 0.2% in 2012.

The slowdown has been caused by a sharp fall-off in export growth to about 0.5% this year from 5.4% in 2011. This is partly attributable to the weaker global economic environment, notably in the eurozone, where GDP contracted in 2012 and 2013.

GDP has also been depressed by the marked decline in exports from the key pharmaceutical sector, following the expiry of patents on some products manufactured here. Exports from the chemical and pharmaceutical sector fell by €3.75bn in the first eight months of this year, equivalent to 3.8% of GDP.