Economy grows due to exports
Published 16/12/2010 | 11:57
The Irish economy grew slightly between July and September, primarily due to strong export demand.
The Central Statistics Office showed the value of all goods and services, or gross domestic product (GDP), grew 0.5pc, while gross national product (GNP), measuring the value of home-grown products, rose 1.1pc.
It is the first time increases have been recorded in the same quarter in both since late 2007.
But the quarterly national accounts showed the economy shrank 0.5pc in the 12 months to the end of September.
Finance Minister Brian Lenihan predicted year-on-year growth would return to positive figures by the end of December or early in the new year, claiming the latest figures showed the economy was stabilising.
"The budget day forecast for economic growth of 1.7pc in 2011, which is in line with the consensus forecast, remains on track," he said.
The CSO blamed the 0.5pc annual drop on declines in all sectors other than agriculture and industry.
The Finance Minister said the economy was on an export-led growth path.
"Exports have increased at an annual rate of over 13pc, which is the strongest rate of growth since early 2001 and this performance has occurred in both the goods and services sectors," Mr Lenihan said.
He said personal spending was in line with expectations, while investment was weak, mainly reflecting the slow housing market.
Industry in the third quarter grew 1.4pc, despite the building and construction sectors shrinking by 8.2pc.
Agriculture also grew, but declines were seen in distribution, transport and communication, which fell 2.5pc and the services sector, which dropped 1.6pc.
Over the three month period, exports were up 3.6pc and imports 1.4pc.
Mr Lenihan added: "The Government has consistently identified export-led growth as the strategy that will return this economy to growth and generate jobs.
"This strategy is working thanks to the improvement of competitiveness, and the flexibility and adaptability of the Irish economy.
"These economic output figures, when combined with the recent reduction in the Live Register, the positive producer and consumer sentiment indicators, and the higher than expected tax revenues, show that there are real positives for the Irish economy as we enter 2011."
The Dail yesterday approved an €85bn bailout from the EU and IMF after the Government won a vote on the controversial rescue package with the support of three independent TDs.
Opposition parties Fine Gael, Labour and Sinn Fein rejected the deal and pledged to renegotiate it if elected to power after next year's general election.