THE DOMESTIC ECONOMY grew sharply during the second quarter of the year, according to new figures from the Central Statistics Office.
Gross national product (GNP), a measure of the size of the economy excluding overseas companies, grew by 4.3 per cent, far ahead of market expectations.
However, gross domestic product (GDP) was flat, after falling 0.7 per cent between January and March. Some analysts had expected it to grow by 1 per cent. Overall, GDP has fallen 1.1 per cent on an annual basis, putting pressure on the government as it looks to meet EU/IMF targets.
According to the CSO, Industry (which includes the manufacturing, energy and building sectors) registered an increase of 4.6 per cent in volume in Q2 2012 compared with Q1 2012. However, the combined decreases in the other sectors of the economy (e.g. Distribution, transport, software and communication (-0.3 per cent), Public administration and defence (-1.7 per cent), Other services (-1.7 per cent) and Agriculture (-5.5 per cent)) resulted in no change overall in GDP between the first and second quarters.
However, the employers body IBEC said that the figures showed that Ireland’s economy was fairing well despite tough external conditions.
“Overall, Ireland is performing relatively well in tough external conditions. Slowdowns in the global economy is nonetheless delaying recovery. It is crucial that Budget 2013 is delivering in a way that is least damaging for the economy. In particular, Government must not add on to the cost of doing business or employing people.”