Business

Wednesday 1 October 2014

Irish economy officially slumps back into recession

Published 27/06/2013 | 11:00

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Construction currently employs 146,000 people, directly and indirectly

THE economy shrank fractionally in the first three months of the year, official figures show - pushing the country technically into recession.

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Gross domestic product declined by 0.6pc, according to preliminary estimates from the Central Statistics Office.

Agriculture, forestry and fishing grew 4.8pc in the first quarter, while industry, including building and construction, was up 2.1pc.

But personal spending dropped 3pc between the last three months of last year and the first three months of 2013.

Capital spending declined 7.4pc while net exports also fell, by about €1bn over the same period.

A spokesman for the Department of Finance said the numbers are disappointing.

He said analysis showed GDP had been falling in both a quarter-on-quarter and year-on-year basis.

The Government blamed the impact of a weak global economy for impacting on demand for Irish exports but also suggested the multibillion pharmaceutical sector was being affected by what it called the "patent cliff" for medicines.

It also said a series of one-off factors were playing their part in the poor returns such as a new registration system for car sales spread figures more evenly over a year.

Despite the bad report, the spokesman insisted all fiscal targets continue to be met.

Ireland's Budget 2014 takes place in October and will include revised forecasts which will be independently assessed.

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