Plummeting imports lead to record trade surplus in 2009
Steep decline in car sales had biggest impact
IN a strange twist to the recession, Ireland posted a record trade surplus last year, as imports tumbled even faster than exports.
A second statistical quirk is that this result means trade made a bigger contribution to the economy, even though trade levels were lower.
For 2009 as a whole, the estimated trade surplus totalled €38.8bn -- more than a third higher than the overall surplus of €28.8bn recorded in 2008.
Behind this headline, detailed figures from the Central Statistics Office for the first 11 months of last year show a 3pc fall in exports over the same period of 2008, and a 23pc drop in imports.
The collapse in imports of road vehicles had the biggest economic impact, with purchases falling from €3bn in 2008 to just €800m in January-November of last year. Imports of computer equipment were down by 46pc and oil products by 36pc -- partly caused by lower oil prices.
The figures came as the head of the World Trade Organisation (WTO) said global trade contracted by about 12pc in 2009 but had started to pick up.
Pascal Lamy said the organisation had revised downwards its previous estimate of a fall of about 10pc last year. He said it was the sharpest decline since the end of World War II.
The figures mean Ireland increased its share of global exports for the first time in several years, even if, like the trade surplus, it was not entirely for the best reasons.
"Irish export volumes have been declining in recent months, but their relative performance has still been quite impressive amid the collapse in global trade flows last year," said Alan McQuaid, chief economist at Bloxham Stockbrokers.
Mr McQuaid said a lot would depend on the performance of sterling, particularly for indigenous exporters.
The figures show a 15pc fall in exports to the UK, and a 30pc drop in imports, in the first 11 months of 2009.
Cross-Border shopping was not enough to offset a €320m fall in imports from Northern Ireland -- a drop of 27pc -- while exports declined 20pc.
"Modest rates of increase in world demand by historical standards are anticipated for this year," Mr McQuaid said. "A recovery in Irish exports seems likely to be muted, with an average volume increase of between 0.5 and 1pc."
The chief executive of the Irish Exporters Association, John Whelan, called for a new export strategy to offset the weakness of sterling and help exporters "move aggressively into new growth markets".