Irish debt investors looking beyond GDP after distorted figures - NTMA
Ireland's distorted gross domestic product (GDP) figures has made them less useful to potential investors into Irish debt, the National Treasury Management Agency (NTMA) has said.
Figures released from the Central Statistics Office last week pointed to an enormous 26pc increase in Ireland's GDP. Ireland's growth was distorted by tax inversion deals by pharmaceutical companies and aircraft leasing companies.
As a result debt investors now must look at other aspects of the Irish economy to determine its attractiveness, NTMA chief executive Conor O'Kelly has said.
"There was the market impact of the surprise of the statistics – we feeded a lot of calls from investors. There was a lot of explaining to do.
"Investors we’ve been speaking are looking to other factors of our economic health for our ability to repay as opposed to GPD to debt ratio," Mr O'Kelly said.
The NTMA chief was speaking at the Public Accounts Committee this morning where he said Ireland remains very much an "indebted nation".
Mr O'Kelly fielded questions from chairman Sean Fleming around the country's implicit interest rate. Mr Fleming said he was "shocked" to learn that countries such as Spain and Italy were paying lower interest rates than Ireland on its debt.
Ireland currently pays 3.3pc on its national debt as opposed to the aforementioned two that pay 3.2pc. The chairman also pointed out that one tenth of one percent would represent a saving of €200m to the State.