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Boston over Berlin puts our manufacturing and services in good position

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Ireland's manufacturing and services sectors have had a pretty good year considering the volatile business conditions across the Eurozone.

Expansion was recorded every single month in 2014 - the first time for the manufacturing sector since 2006.

And this was despite the lacklustre performance in the rest of the Eurozone, which has entered 2015 in less than inspiring fashion.

Philip O'Sullivan, economist with specialist bank Investec, which compiles the data along with financial information firm Markit, said Ireland has been relatively immune from the euro-area woes largely because our main trading partners include the UK and US, whose economies are performing quite well.

"We are closer to Boston than Berlin, in terms of were our exports are concerned. The three key trading partners are the US, UK and the Eurozone," Mr O'Sullivan said.

"If one of them was performing badly, you'd want it to be the Eurozone if you had to choose one. With the euro slumping, that's something that's going to really help the competitiveness of Irish exports," he said.

"The Irish PMIs are doing a lot better than the Eurozone's because we are more leveraged to what's happening in the Anglo economies, the US and UK, both of which are growing very healthily. The weaker Euro against sterling and the dollar is something that have made our exports a lot more competitive."

The Purchasing Managers Index for both sectors recorded readings of above 50 each month of the last year, which means the sectors were expanding.

Manufacturing started off the year in growth territory, but it wasn't a spectacular beginning to 2014. Production growth slowed to the weakest in five months and firms lowered their purchasing activity. But by the end of the year, the sector reported the best increase in new export sales since 2010.

The services sector had an impressive year, with a reading of above 60 recorded for 11 months.

One of the notable elements of both sectors was a near continuous rise in employment.

"That's critical for Ireland because solving the unemployment issue is key to solving the three biggest challenges that did face the economy: the crisis in the public finances, the crisis in terms of household debt levels and just the unemployment crisis itself," Mr O'Sullivan said.

"In terms of getting more of our people back to work, that's been really encouraging."

So can Ireland weather the euro and international storm?

Possibly not for much longer, according to Mr O'Sullivan. But he says growth shouldn't be too badly affected.

"The international backdrop has deteriorated in the past couple of months, and I don't think Ireland is going to be immune.

"Russia, Greece, Ukraine, parts of the Middle East, this will definitely have an effect. So while our view is that the economy will continue to grow quite healthily, the headline growth may moderate.

"It's probably not going to be quite as rosy as we would have seen throughout 2014," he said.

Irish Independent