Manufacturing output falls despite strong growth elsewhere

Latest figures from CSO show industrial production fell by nearly 4% in February

 

Manufacturing output fell by 3.9 per cent in February despite the strength of headline growth in the Irish economy.

Monthly production figures are now notoriously volatile, however, and are often out-of-kilter with gross domestic product (GDP), which grew by 7.8 per cent last year.

While the latest Central Statistics Office (CSO) numbers recorded a sharp monthly fall, industrial production on an annual basis was up 3.5 per cent, and by 0.6 per cent in the first two months of the year compared to 2017.

“This is entirely driven by the pharma–dominated modern sector, with output in the traditional sector contracting year-to-date,” Davy analyst David McNamara said.

“Nonetheless, the data are volatile and, in recent times, have been a poor guide in GDP output so we wouldn’t read too much into the early 2018 figures,” he said.

According to the latest numbers, the “modern” sector showed a monthly decrease in production of 2.8 per cent in February 2018 and an annual increase of 4.5 per cent compared with February 2017. There was a monthly increase of 1.5 per cent in the “traditional” Sector in February and an annual decrease of 1.9 per cent compared with February 2017.

One of the main driving forces behind Irish exports is medical and pharmaceutical products.

The EU accounted for around €5 billion or 5 per cent of Ireland’s exports , with Belgium accounting for the largest single share.

Antwerp is one of the largest global drug redistribution hubs and receives most of the State’s pharma exports not destined for the US.