Ireland: Economy#
Ireland is a small, modern, trade-dependent economy. Ireland was among the initial group of 12 EU nations that began circulating the euro on 1 January 2002.GDP growth averaged 6% in 1995-2007, but economic activity dropped sharply during the world financial crisis and the subsequent collapse of its domestic property market and construction industry. Faced with sharply reduced revenues and a burgeoning budget deficit from efforts to stabilize its fragile banking sector, the Irish Government introduced the first in a series of draconian budgets in 2009. These measures were not sufficient to stabilize Ireland’s public finances. In 2010, the budget deficit reached 32.4% of GDP - the world's largest deficit, as a percentage of GDP. In late 2010, the former COWEN government agreed to a $92 billion loan package from the EU and IMF to help Dublin recapitalize Ireland’s banking sector and avoid defaulting on its sovereign debt. In March 2011, the KENNY government intensified austerity measures to meet the deficit targets under Ireland's EU-IMF bailout program.
In late 2013, Ireland formally exited its EU-IMF bailout program, benefiting from its strict adherence to deficit-reduction targets and success in refinancing a large amount of banking-related debt. In 2014, the economy rapidly picked up and GDP grew by 5.2%. The recovering economy assisted lowering the deficit to 2.5% of GDP. In late 2014, the government introduced a fiscally neutral budget, marking the end of the austerity program. Continued growth of tax receipts has allowed the government to lower some taxes and increase public spending while keeping to its deficit-reduction targets. In 2015, GDP growth reached 7.8%, the highest growth in the EU for the second consecutive year.
In the wake of the collapse of the construction sector and the downturn in consumer spending and business investment, the export sector, dominated by foreign multinationals, has become an even more important component of Ireland's economy. Ireland’s low corporation tax of 12.5% and a talented pool of high-tech laborers have been key factors in encouraging business investment. Loose tax residency requirements made Ireland a common destination for international firms seeking to avoid taxation. Amid growing international pressure, the government announced it would phase in more stringent tax laws, effectively closing a loophole.
Economic Facts#
| GDP (purchasing power parity) | $324.3 billion (2016 est.) $309 billion (2015 est.) $244.7 billion (2014 est.) note: data are in 2016 dollars |
|---|---|
| GDP (official exchange rate) | $307.9 billion (2015 est.) |
| GDP - real growth rate | 4.9% (2016 est.) 26.3% (2015 est.) 8.5% (2014 est.) |
| GDP - per capita (PPP) | $69,400 (2016 est.) $66,700 (2015 est.) $53,100 (2014 est.) note: data are in 2016 dollars |
| Gross national saving | 31.9% of GDP (2016 est.) 31.9% of GDP (2015 est.) 23.6% of GDP (2014 est.) |
| GDP - composition, by end use | household consumption: 36.7% government consumption: 10.8% investment in fixed capital: 20.4% investment in inventories: 0.6% exports of goods and services: 124.1% imports of goods and services: -92.6% (2016 est.) |
| GDP - composition, by sector of origin | agriculture: 1% industry: 41.3% services: 57.6% (2016 est.) |
| Agriculture - products | barley, potatoes, wheat; beef, dairy products |
| Industries | pharmaceuticals, chemicals, computer hardware and software, food products, beverages and brewing; medical devices |
| Industrial production growth rate | 1.2% (2016 est.) |
| Labor force | 2.181 million (2016 est.) |
| Labor force - by occupation | agriculture: 5% industry: 11% services: 84% (2015 est.) |
| Unemployment rate | 8% (2016 est.) 9.5% (2015 est.) |
| Population below poverty line | 8.2% (2013 est.) |
| Household income or consumption by percentage share | lowest 10%: 2.9% highest 10%: 27.2% (2000) |
| Distribution of family income - Gini index | 31.3 (2013 est.) 35.9 (1987 est.) |
| Budget | revenues: $78.47 billion expenditures: $80.86 billion (2016 est.) |
| Taxes and other revenues | 25.5% of GDP (2016 est.) |
| Budget surplus (+) or deficit (-) | -0.8% of GDP (2016 est.) |
| Public debt | 77.9% of GDP (2016 est.) 78.7% of GDP (2015 est.) note: data cover general government debt and include debt instruments issued (or owned) by government entities other than the treasury; the data include treasury debt held by foreign entities; the data include debt issued by subnational entities, as well as int |
| Fiscal year | calendar year |
| Inflation rate (consumer prices) | 0.2% (2016 est.) 0% (2015 est.) |
| Central bank discount rate | 0.05% (31 December 2015) 0.15% (31 August 2014) note: this is the European Central Bank's rate on the marginal lending facility, which offers overnight credit to banks in the euro area |
| Commercial bank prime lending rate | 3.3% (31 December 2016 est.) 3.36% (31 December 2015 est.) |
| Stock of narrow money | $144.3 billion (31 December 2016 est.) $146.7 billion (31 December 2015 est.) note: see entry for the European Union for money supply for the entire euro area; the European Central Bank (ECB) controls monetary policy for the 18 members of the Economic and Monetary Union (EMU); individual members of the EMU do not control the quantity of |
| Stock of broad money | $255.3 billion (31 December 2014 est.) $267.4 billion (31 December 2013 est.) |
| Stock of domestic credit | $285.8 billion (31 December 2016 est.) $305 billion (31 December 2015 est.) |
| Market value of publicly traded shares | $128 billion (31 December 2015 est.) $143.5 billion (31 December 2014 est.) $170.1 billion (31 December 2013 est.) |
| Current account balance | $29.11 billion (2016 est.) $29.02 billion (2015 est.) |
| Exports | $160.1 billion (2016 est.) $160.9 billion (2015 est.) |
| Exports - commodities | machinery and equipment, computers, chemicals, medical devices, pharmaceuticals; foodstuffs, animal products |
| Exports - partners | US 23.7%, UK 13.8%, Belgium 13.2%, Germany 6.6%, Switzerland 5.5%, Netherlands 4.4%, France 4.4% (2015) |
| Imports | $88.01 billion (2016 est.) $87.79 billion (2015 est.) |
| Imports - commodities | data processing equipment, other machinery and equipment, chemicals, petroleum and petroleum products, textiles, clothing |
| Imports - partners | UK 32.5%, US 14%, France 10.2%, Germany 9.3%, Netherlands 4.9%, China 4.1% (2015) |
| Reserves of foreign exchange and gold | $2.203 billion (31 December 2015 est.) $1.748 billion (31 December 2014 est.) |
| Debt - external | $2.47 trillion (31 March 2016 est.) $2.35 trillion (31 March 2015 est.) |
| Stock of direct foreign investment - at home | $1.057 trillion (31 December 2016 est.) $963.4 billion (31 December 2015 est.) |
| Stock of direct foreign investment - abroad | $1.435 trillion (31 December 2016 est.) $1.321 trillion (31 December 2015 est.) |
| Exchange rates | euros (EUR) per US dollar - 0.9214 (2016 est.) 0.885 (2015 est.) 0.885 (2014 est.) 0.7634 (2013 est.) 0.78 (2012 est.) |