The continuing fallout from high-profile drugs losing patent protection helped drag down export performance during June.
Latest external trade figures from the CSO detailed a 1.7% — €126m — fall in seasonally adjusted exports compared to May. Imports also decreased on a monthly basis, falling by €85m, or 2.1%, in June. This resulted in a 1.2% monthly fall in Ireland’s overall trade surplus, to just over €3.42bn.
Chemicals and related products accounted for over 60% — worth nearly €5bn — of the total €8bn value of exports in June. But, on a year-on-year basis, chemical exports were down by 18%, with medical and pharmaceutical product exports falling by €300m, or 12%.
This, according to some commentators, could be a key concern for the future.
“The export sector has been the main driver of Irish economic activity in recent times and will remain the key growth engine for some period to come, but there are clear downside risks in the short-term — especially in relation to external demand,” according to Alan McQuaid of Merrion Stockbrokers.
He added: “Another concern is the sustainability of the recent impressive performance of the pharmaceuticals sector.
“In fact, a substantial part of the sharp decline in the value of exports, last December, was due to the high-value cholesterol treating drug, Lipitor, coming off patent — something that is likely to be repeated in other pharmaceutical products going forward.”
Mr McQuaid sees export growth being weaker in 2012, as a whole, compared to last year, but still sees a volume increase in goods and services exports of 4%, rising back up to 4.5% in 2013 and 2012’s overall trade surplus still coming in at €43bn, not far short of last year’s record high total.
David McNamara, of Davy Stockbrokers, said that while the latest CSO data was disappointing, “we cannot infer much about export growth from the volatile monthly series until the CSO publishes export volumes for 2012 and the second quarter national accounts are released.”
The June CSO figures also show that Britain and Belgium accounted for 30% of exports. The EU, as a whole, accounted for 62%, with the US the main destination beyond Europe, accounting for 19%.
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