Exports key to growth despite dip

EXPORT performance is still expected to be the main driver of growth in the Irish economy next year, despite latest figures from the Central Statistics Office (CSO) showing a significant fall in value in October and a near €1 billion dip in the country’s overall trade surplus.

October saw Ireland’s trade surplus fall to just under €2.95bn, down from the €3.7bn registered in September. This was on the back of a 14% rolling month-by-month fall in the value of Irish exports; after September had shown an 11% increase on August. On an annualised basis, the value of exports fell by 15% in October. Import value, meanwhile, was down 30%, year-on-year and by 7% on a month-by-month basis.

The latest external trade data from the CSO also detailed performance for the first nine months of the year. During that time – on a year-on-year basis – Irish export value fell by €35 million to €64.43bn; the export of goods to Britain and Germany decreasing, but increasing to the US. For the same timeframe, import value was down by €10.25bn at €33.84bn. During that period, imports to Ireland from Britain and Germany and China were down but incoming goods from the US were up by nearly 20%, year-on-year.

Alan McQuaid of Bloxham Stockbrokers said the overall export performance has been promising this year and is still the key factor in full economic growth.

“The trend in Irish exports in the year to-date has been better than expected. Of course, most of the demand has come on the pharmaceuticals side, with indigenous exports suffering as a result of a depressed British economy and adverse exchange rates.

“Although the volume of merchandise exports could be down 6% or more for the year, it would still be a very good performance. The bottom line is that exports will be the main driver of the Irish economic recovery when it comes, and we wouldn’t be surprised to see a positive volume increase in 2010 as global demand rises,” he said.

Meanwhile, the CSO also reported yesterday, via the monthly wholesale price index, that monthly factory gate prices – basically the price charged for goods by manufacturers, excluding transport costs – fell by 0.1% last month compared to October and was down 6.5% on a year-by-year basis.


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