Ireland sees sharpest industrial output fall in Europe
Ireland's first annual decline in industrial production, recorded in May, was the sharpest fall in industrial production recorded in any European country in that month, according to new data.
The figures from the European Union's statistics agency, Eurostat, show that as a whole industrial production in the Eurozone fell by 0.4pc in May compared to April. In the European Union as a whole production was down by 0.3pc. Ireland recorded the largest drop out of any country in the European Union as industrial production declined by 6.9pc on a month-by-month basis. The Netherlands saw the second largest fall, as production was down by 5.7pc, with Greece following closely with a decline of just over 5pc.
On the other end of the spectrum Croatia saw the largest increase in industrial production, with output in the sector rising by 2.6pc. Lithuania was next, with a rise of 1.7pc, while Portugal rounded out the top three with an expansion of 1pc.
On an annual basis Ireland also saw one of the biggest falls of any European country. Compared to May 2014, industrial output was down by 5pc in May, according to Eurostat.
This was the third sharpest decline on an annual basis, with only the Netherlands and Finland ranking lower with falls of 7.4pc and 5.1pc respectively.
The drop recorded by Ireland in May was the first annual decline of the year so far in the country.
However, Alan McQuaid of Merrion Stockbrokers said that the drop was more than likely an anomaly and said that the industrial figures seen in May should not act as a major cause for alarm.
"You would want to see a decline of that level for two or three months back to back to see any sort of trend," he said. "I think it is a blip and I would expect to see the sector rebounding later in the year, I think that the third quarter will be very strong."
He pointed out that the Irish industrial sector enjoyed extremely strong growth of about 24pc last year, adding that he expected to see similar overall levels of growth for 2015.
"A lot of the industrial production is from pharmaceutical companies who tend to be acyclical in terms of demand," he said, saying that many tend to distort figures due to contract manufacturing.
"Contract manufacturing is when manufacturing co-ordinated by Irish-based firms but which takes place elsewhere being booked on Irish national accounts.
"Contract manufacturing is always a problem with the statistics [but] I think that the underlying sector is still good. I still expect our manufacturing as a whole will be the strongest in the Eurozone over the year," he said.
Although May was a relatively weak month for the industrial sector, as a whole Irish industrial production rose by 20pc in the first four months of the year, according to data from the CSO. However, construction dropped by 2.6pc in the first quarter of 2015.