Michael Taft: Before we break our arms from patting ourselves on the back over our export growth, let’s take a fact break. Clearly, Irish exports grew by a greater amount than the Government expected. In December 2009, they predicted exports would grow by only 0.4 per cent. It looks like they will come in at a growth of around 6 per cent or so. Words like ‘strong’, ‘robust’, ‘resilient’, etc. have been thrown around with abandon.
Well, in comparison with previous projections it is all those things. But let’s leave our little island world and the associated little island commentary for a moment and look at the wider European landscape. Irish export growth is hardly anything to talk about – indeed, it looks rather anaemic (and credit to Rory O’Farrell for spotting this).
Eurostat has recently published the latest data on EU goods exports. It compares non-seasonally adjusted, export growth between the first three quarters of 2009 and 2010. What does it find?
• Ireland: 2 per cent
• EU-27 average: 18 per cent
• EU-15 average: 13 per cent
In the first three quarters of this year, average goods export growth in the EU greatly outstripped Irish growth.
Of course, this could be a result of bounce-back. For in 2009 most EU countries took a severe export hit as a result of the fall in global demand. Ireland didn’t. However, if we take a longer perspective – from the eve of recession to the present - Irish goods exports don’t look especially resilient. Comparing the three-year period from the first three quarters in 2007 to 2010 we find:
• Ireland: - 1.6 per cent
• EU-27 average: -1.2 per cent
• EU-15 average: - 4.6 per cent
While Ireland held up better than most other EU-15 countries, for the EU as a whole we came in about average. And if current trends continue, we may find ourselves falling behind our EU partners – only just hanging in there courtesy of a modern multinational sector which is only tangentially connected to the rest of the economy.
None of this is to gainsay the benefits of export growth. However, it is about ensuring that we put things into perspective – a pre-condition to the next step which is to more closely examine what is going in our export markets and determine how beneficial it will be to the Irish economy.
Michael Taft @notesonthefront
Michael Taft is an economic analyst and trade unionist. He is author of the Notes of the Front blog and a member of the TASC Economists’ Network.
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