IBEC - Newsroom

IBEC, the group that represents Irish business, today said that the National Accounts data from the CSO show that the exporting sector rebounded strongly in the first quarter of the year, but that the trend in the domestic economy remains weak.

Commenting on the data, IBEC economist Reetta Suonperä said: “In the first quarter of the year, GDP expanded by a solid 2.7% relative to the final quarter of 2009, but, disappointingly, GNP slipped back by a further 0.5%.

“The trading sector benefitted from the international recovery and export growth in the first quarter at 6.9% was very strong. While net exports made a positive contribution in 2009, it was mainly because of falling imports. The solid start to the year is therefore very welcome and bodes well for a sustained export-led recovery.

“Technically, with positive quarterly GDP growth, Ireland exited recession in the first quarter of the year, but the domestic economy continues to lag the traded sectors. The quarterly decline in consumer spending at 0.2% was only marginal, but investment, construction in particular, continues to be a significant drag on output.

“The weakness in the domestic sector was further highlighted by the disappointing increase of 5800 in the June Live Register figures. Men accounted for over 80% of the increase, indicating that job losses in the male-dominated construction sector continue.

“The weakness in the domestic sectors further highlights the need for well-targeted public capital investment in projects that represent good value for money, thereby boosting Ireland’s long-term growth potential and providing temporary stimulus for jobs and activity the domestic economy."