NEW FIGURES RELEASED by the Central Statistics Office show that Ireland’s economic output decreased in the last quarter of 2011 – putting Ireland back into a recession.
Ireland’s Gross Domestic Product declined by 0.2 per cent in the final quarter of the year, following on from a 1.9 per cent decline between July and September.
Gross National Product – which is seen by some as a more reliable indication of the domestic economy – shrank by 2.2 per cent between October and December, having fallen by the same rate in the third quarter.
With both measures indicating that the economy shrank for two successive quarters, it can now officially be declared that Ireland has re-entered recession.
Those quarterly rates of decline also mark the worst rates since early 2009, and reverse much of the growth recorded in the first two quarters of last year.
On a year by year basis, GDP – the total value of all goods and services produced in Ireland – increased by 0.7 per cent, though this is below the rate of inflation. GNP was down by 2.5 per cent before inflation kicks in.
The GDP increase for 2011 follows three consecutive years of decline, from 2008 to 2010.
The employers’ group IBEC saw positives in the figures, noting that overall growth was up for the year, but said the priority for 2012 had to be job creation.
Sector by sector
Today’s figures for 2011 show that industry grew by 4.5 per cent while agriculture, forestry and fishing increased by 2 per cent between 2010 and 2011.
However, the greatest declines were experienced by building and construction (-13.5 per cent), and public administration and defence (-3.3 per cent). Other areas that saw annual declines were distribution, transport and communications (-1.6 per cent).
Exports performed strongly in 2011, while imports declined slight, which meant an overall growth of €7,245m in net exports.
Personal consumption fell by 2.7 per cent, while Government expenditure was down 3.7 per cent on 2010.
The largest percentage annual decline in 2011 was seen in capital formation (-10.6 per cent) but this was still on a smaller scale than previous years.
Additional reporting by Gavan Reilly