The fastest growing trade partners for Ireland over the next 15 years will be the Asian economies of Vietnam, India, and Malaysia.
That is according to a study in which HSBC said it sees the outlook for Irish external trade as being “bright”, with robust growth in the US and Britain and a weaker euro helping to sustain strong export growth in the coming years. Low oil prices and improving consumer confidence should support a recovery in domestic demand, it added.
“The medium-to-long-term outlook for Ireland is encouraging, as it benefits from strong performances by its main trading partners. As a small and open economy, Ireland’s economic progress is clearly tied to the success of its export sector,” HSBC said in its report.
“As well as strong export growth and an unfolding recovery in investment levels, consumer spending should also revive over the medium term, as economic conditions improve and debt levels fall. In light of these factors, we are projecting fairly robust growth in real GDP, of around 2.8% per annum, in the decade to 2030.”
Chemicals/pharma is set to retain its dominant position as Ireland’s top export sector, but HSBC believes Ireland’s attractiveness as a low-cost base can help attract more international electronics firms to invest here in new manufacturing facilities. Ireland currently supplies around 20% of western Europe’s electronics.
HSBC sees the UK retaining its position as Ireland’s main trade partner for some time, but for the US to nudge Germany into third place, in export terms.
In the decade up to 2030, HSBC said it sees the economies of Asia becoming the fastest-growing origins of merchandise imports for Ireland. “We expect the value of imports from China, Vietnam, Bangladesh, and India — all growing at 10% per annum — to lead this expansion,” it said.
“Climbing incomes in emerging markets should help Ireland to expand its export base in the years ahead. Reflective of this, our projections show that the fastest-growing export destination for Irish exports in the decade to 2030 will be China; closely followed by Vietnam, India, and Malaysia, all with export growth of around 11% per annum.”
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