Irish Gross National Product Shrinks By 2.2%

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The continued austerity programme is costing jobs and making recovery almost impossible, the Irish Congress of Trade Unions said yesterday.

Official figures released yesterday showed that the Irish gross domestic product (GDP) contracted by 1.9% in the third quarter of this year.

The gross national product (GNP) which excludes profits made by multi-nationals operating in Ireland, shrank by 2.2%.

On an annual basis, GDP fell by 0.1% and GNP was down 4.2%.

Ireland’s Central Statistics Office (CSO) said consumer spending and government spending both fell by 1.3% during the third quarter, while investment slumped by 20.9%. Exports increased by 0.8%, however.

The only sector to record an increase in output during the third quarter was agriculture, forestry and fishing, where output rose 4.5%.

Industrial output fell 1.3%, including a 5.9% drop in building and construction.

Separate CSO figures showed the balance of payments current account surplus in the third quarter of this year was 850m euros, down more than 300m euros compared with the same period last year.

The merchandise surplus of more than 9.86bn euros was boosted by strong exports. But the invisibles deficit widened, mainly because of a fall in inward investment income.

For the first nine months of this year, there was a balance of payments deficit of 669m euros, compared with a deficit of 794m euros in the same period last year.

Speaking in the aftermath of the new figures, Congress general secretary David Begg said: ‘Once again we have clear confirmation that austerity is simply not working and the need to generate growth is the key to recovery.

‘In his budget speech, the Minister for Finance indicated that he was interested in pursuing a proposal we made in relation to facilitating private pension fund investment in key projects.

‘We would urge him to act speedily on this and for the government as a whole to act on a wider range of initiatives that can inject some growth into the economy.

‘We need growth and we need it quickly.’