Exports down 10.2pc on back of pharmaceutical sales slide
THE value of exports slumped 10.2pc in February from the same month last year as sales of medicines slid.
The main driver behind the decrease was a 15pc fall in the value of medical and pharmaceutical products and an 18pc drop in organic chemicals.
But the seasonally adjusted trade surplus as recorded by the Central Statistics Office (CSO) rose to €3.1bn in February from €2.9bn in January.
Analysts have warned of short-term risks in relation to external demand and the strength of the euro versus sterling.
"At the end of the day the export sector has been the main driver of Irish economic activity in recent times and will remain the key growth engine for some period to come," said Merrion Stockbrokers economist Alan McQuaid.
"The main positive on the export side at the moment is the strong performance of the services sector, with an average annual increase of 9pc in volume terms recorded last year. This compared with an average fall of 2.9pc in merchandise goods." Key figures from the CSO include:
• The value of exports fell 10pc between February of 2011 and 2012, to €6.6bn.
• The EU accounted for €3.8bn of total exports in February, with the US the main non European destination, accounting for 22pc in February, or €1.5bn.
• The value of imports dropped 2pc in the year to last February, to €3.9bn.
• Imports of petroleum, petroleum products and related materials fell €128m.
• Two-thirds of the value of imports in February came from the EU, with one-third from Britain. The US and China were the main non-EU sources of imports.
Stockbrokers Davy said they expect weak demand from the eurozone to weigh on Irish exports.
"The impact of the pharmaceutical patent cliff remains uncertain," analyst David McNamara said.
"Production volumes in pharmaceuticals rose sharply in February, but this has yet to be borne out in the trade data.
"The fall in exports values suggests that patent expirations may well be impacting on prices, but production volumes remain robust in the sector."
NCB said the weak start to the year was not unexpected given the trends in the second half of last year.