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Ireland was EU's fastest-growing economy in 2017

Written by Robert McHugh, on 15th Mar 2018. Posted in Economy

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Ireland's gross domestic product (GDP) grew 7.8% in 2017, making it the European Union's fastest-growing economy for the fourth straight year, although the figures were again flattered by statistical distortions.

The relevance of using GDP as an accurate measure for such an open economy was called into question when 2015 growth figures were adjusted up after a massive revision to the stock of capital assets related to Ireland's large multinational sector.

While other more stable data point to very strong growth in the real economy, last year net exports were flattered greatly by the absence of large imports of intellectual property and aircraft leasing activity, which have skewed data in the past.

That pushed GDP up 10.9% year-on-year in the third quarter, revised slightly up on Thursday and meant annual growth stood at 8.4% in the final three months of the year.

The economy expanded by 3.2% on a quarterly basis from October to December, compared with 4.8% in the previous quarter.

The statistics office has begun to phase in new measures which strip out some of the distorting globalised activities. Modified total domestic demand rose by 3.9% in 2017 compared with 2016, suggesting the wider economy is feeling little initial impact from Brexit.

Ireland has rebounded quickly from an economic crash a decade ago that pushed it into an international bailout in 2010, and the momentum has continued into this year with unemployment falling to 6.1% from a peak of 16% in the crisis.

Data on Wednesday showed that employment - which analysts say is the cleanest gauge of Irish growth - was just shy of the 2007 peak at 2.23 million at the end of 2017 following a sharp rise in jobs growth in the fourth quarter.

Source: www.businessworld.ie

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