Trade surplus slumps to lowest level in six years
IRELAND's trade surplus hit its lowest level in just over six years, the Central Statistics Office said yesterday.
Analysts described the March data from the CSO as disappointing.
Exports fell 4pc in March from the previous month, but by contrast, imports jumped 12pc.
Over the course of the year, the value of exports dropped 6pc as the impact of the so-called pharmaceutical patent cliff continues to dent Ireland's crucial export sector.
The trade surplus fell by €732m and now stands at €2.4bn. This is the lowest seasonally adjusted surplus recorded since March 2008.
The main drivers behind the fall in the value of exports was a 16pc drop in the exports of organic chemicals and a 10pc fall in pharmaceutical and medical products. The EU accounted for the bulk of exports, while the US was the main non-EU destination.
Comparing March of this year with March 2013, the value of imports rose 16pc to €4.8bn.
Merrion Stockbrokers said strong global demand should partly offset the negative drag from the patents expiry issue, with the pharmaceutical sector accounting for about a quarter of total Irish exports and about a half of merchandise exports. Cantor Fitzgerald said Ireland still had a large trade surplus overall.
"Services exports, which make up 52pc of total exports, are taking up some of the slack from weakness on the goods side," it said.
Davy said the sector was slowly recovering, and benefitting from the emergence of the euro area from recession and the ongoing recovery in the UK.
"Given the month-to-month volatility in the series, not too much can be made of the exceptionally narrow deficit in March."
Also, to the extent that imports have increased, they may be indicative of stronger domestic demand," it said.