Less than 3% Irish SMEs export goods, new figures show

Only small fraction of Irish-based firms export goods abroad despite the State’s reputation as a small, export-led economy

Less than 3 per cent of Irish SMEs (small and medium-sized enterprises) export goods to other countries, according to the Department of Enterprise, Trade and Employment.

The headline figure, which is low by international standards and at odds with Ireland’s reputation as a small, export-led economy, was released in response to a parliamentary question from Sinn Féin’s Louise O’Reilly.

The department’s figures show that in 2019 just 3.2 per cent (11,000) of the roughly 350,000 Irish-based SMEs were classified as exporters. In total, they exported €38.3 billion worth of merchandise and contributed 23 per cent to the share of gross value added (GVA) of Irish SMEs.

In 2020, the share of Irish SMEs that exported goods fell to 2.9 per cent with the value of exports decreasing to €29.7 billion.

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In 2021, it rose to 3 per cent with the value of exports rising to €31.2 billion. Provisional figures for 2022 show just 2.8 per cent of SMEs exported goods worth €35.6 billion.

The figures, which were restricted to exporters of goods rather than services, showed the percentage of medium-sized firms (those containing 50-249 employees) that were classified as exporters ranged from 26 to 31 per cent.

The percentage of small firms (those with 10-49 staff) that exported was 13-14 per cent while micro enterprises (those with 10-49 staff) accounted for the smallest proportion of exporters, ranging from 1.8 per cent to 2.2 per cent.

The department’s figures, which excluded exports from the agriculture, forestry and fishing sector here, showed that 13 per cent of Irish SMEs in the industry sector, which includes food producers, engaged in export activities while almost 9 per cent of SMEs in the wholesale and retail sector exported goods. In the services sector, only one in a hundred enterprises export goods each year.

“The level of exporting by SMEs is extraordinarily low, even lower than previously thought – hovering around 3 per cent for many years,” Ms O’Reilly, who is Sinn Féin’s spokeswoman on enterprise, trade and employment, said.

“Naturally, the failure to increase the number of SMEs who export is damaging in terms of growth opportunities as international trade is strongly linked to better overall economic performance,” she said.

“This is particularly true of smaller states, such as Ireland, where the size of the domestic market limits the ability of firms to achieve economies of scale,” she said.

Ms O’Reilly said: “Businesses which export generally perform better across key performance indicators, including employment and productivity; therefore, expanding participation in exporting will improve broader economic performance.”

The department’s data was mined from Central Statistics Office (CSO) figures and figures from other agencies. Enterprises must have had more than €1,000 in export value in a calendar year to be counted as an exporter.

Eoin Burke-Kennedy

Eoin Burke-Kennedy

Eoin Burke-Kennedy is Economics Correspondent of The Irish Times