Ireland’s GDP rises 13.5% to €428bn

Dublin

Ireland’s gross domestic product (GDP) grew 13.5% to €428.3 billion in 2021, driven by a strong upturn in its multinational dominated sectors, according to national accounts published by the country’s Central Statistics Office (CSO).

There was growth of 16.6% in exports of goods and services during the year.

The multinational dominated sectors grew 21.9% in 2021 with all other sectors increasing 5%.

Ireland’s balance of payments current account recorded a surplus of €58.8 billion in transactions with the rest of the world in 2021, driven by improvements in the merchandise and services balances.

Personal spending reached €105.2 billion in 2021, up from the 2020 result of €99.5 billion, but 5.3% lower than the €111.1 billion pre-pandemic level of spending in 2019.

Assistant Director General with responsibility for Economic Statistics, Jennifer Banim, said in a statement: “Several sectors focused on the domestic market experienced higher levels of economic activity in 2021, with the Distribution, Transport, Hotels & Restaurants sector growing by 6.2% and Arts & Entertainment increasing by 12.6%.

“However, the Construction sector contracted by 4.7% in the year and Agriculture, Forestry & Fishing decreased by 1.4%.

“Growth continued in the more globalised sectors of the economy with Industry increasing by 24.0% and the Information & Communication sector growing by 14.1% in the year.

“Overall, multinational dominated sector growth was 21.9% and in 2021, these sectors accounted for 56.2% of total value added in the economy, compared with a 52.5% share in 2020 and a 45.1% share in 2019.

“Looking at expenditure in the economy, Government spending on goods and services increased by 5.3% in 2021, while personal spending on goods and services (the PCE indicator) increased by 5.7% in the year.

“Looking at PCE constant price levels over the past three years, personal spending reached €105.2 billion in 2021, a recovery compared to the 2020 result of €99.5 billion, but 5.3% lower than the €111.1 billion pre-pandemic level of spending in 2019.

“PCE accounted for almost 25% of GDP in 2021, down from 26.4% of GDP in 2020 and 31.1% in 2019.

“Overall, GDP is estimated to have increased by 13.5% in 2021, driven largely by growth of 16.6% in Exports of Goods & Services in the year.

“GNP – a measure of economic activity that excludes the profits of multinationals – increased by 11.5% in 2021.”

On the impact of globalisation activities in 2021, Banim said: “Compared to 2020, investment in Intellectual Property Products (IPP) decreased by 56.1% in 2021, driving a decrease of 16.6% in Final Domestic Demand in the year.

“Modified Domestic Demand (MDD), a broad measure of underlying domestic demand that excludes IPP and aircraft related globalisation effects, increased by 6.5% in 2021.

“In International Accounts results, the Current Account of the Balance of Payments recorded a surplus of €58.8 billion in flows with the rest of the world in 2021, driven by improvements in the merchandise and services balances.

“The improvement of €58.8 billion in the Services balance between 2020 and 2021 reflects the lower levels of IPP imports in 2021.

“Multinational profit net outflows were €90.7 billion in the year, an increase of €21.0 billion on 2020 levels.

“Today’s International Accounts publication includes a table of Current Account transactions with the UK.

“The results show a surplus of €17.5 billion for Trade in Goods & Services with the UK in 2021, an increase of €6.2 billion on the 2020 trade balance.

“The trade surplus was offset by a deficit of €10.6 billion for net income flows, giving an overall Current Account surplus of €6.9 billion with the UK in 2021.”

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Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.