The euro crisis is giving a competitive edge to Irish exports as the value of the single currency falls against the pound and the dollar.
The euro fell by as much as 0.7% to $1.2681 but recovered in afternoon trading. Against the pound, the euro slipped to 79.50 pence.
The chief executive of the Irish Exporters Association, John Whelan, said the decline in the value of the euro was benefiting our indigenous exporters, particularly as they export mainly to the British market.
A weak euro is also a boost to the multinational corporations with operations in Ireland.
Mr Whelan said the US multinationals would see an increase in the productivity of their Irish workforce as their payroll costs decreased on the back of a weak euro.
“One big positive from the fall of the euro against the pound is that it will give a significant boost to goods and services exporters. The increased value available in Irish exports should enable exporters to expand their businesses abroad. Despite the doom and gloom in the eurozone due to Greece, there are a lot of positives to be taken from the current situation,” he said.
The Irish Exporters Association urged banks to allow businesses to lock in the current exchange rates for the rest of the year without using up all of their available credit: “We are trying to get the banks to be more proactive in offering forward contracts to exporters.”
Irish exporters are some of the strongest performers within the eurozone. Figures released by Eurostat yesterday showed that Ireland had the third-largest trade surplus in the EU during January and February.
Only Germany, who recorded a trade surplus of €27.8bn, and the Netherlands which ran a surplus of €7.2bn surpassed Ireland. The Irish trade surplus was €6.8bn. Ireland’s main trading partner, Britain recorded the largest trade deficit in Europe, at -€23.7bn.
Despite the positive figures from Eurostat and further positive figures from the Irish Central Statistics Office for March, Davy’s stockbrokers said they expect a decline in export growth during 2012.
The CSO provisional figures for the end of March showed that the value of Irish exports in March increased by 5% from February. The value of Irish exports reached €7.62bn in March, up from €7.26 in February.
However, Davy’s analyst, David McNamara, said that after comparing the results for the first three months of this year with the same time period last year, it was apparent that the eurozone contraction had yet to be reflected in the export figures.
“We still expect a marked slowdown in export growth in 2012,” he said.
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