Ireland pulls out of recession as exports help recovery strengthen

THE IRISH economy climbed out of recession in the second quarter, official figures showed yesterday, as the struggling Eurozone nation showed signs of life.

National accounts reveal a 0.4 per cent increase in GDP in the three month period, driven by growth in exports which soared 4.3 per cent.

However, GNP – which excludes some of the effects from multi-nationals based in Ireland – fell 0.4 per cent in real terms in the period.

The more frequently-used GDP figures were welcomed, nonetheless. Consumption growth hit 0.7 per cent, while government spending and investment fell by 1.3 per cent and 3.4 per cent respectively.

Yet despite the relatively healthy quarterly data, the economy is still 1.2 per cent smaller than it was in the same period of 2012.

Additionally the government may face a challenge in passing its 2014 budget in mid-October.

Although those clouds remain, many economists believe the recovery should gradually gather strength.

“Consumer confidence has picked up recently and government policies aimed at dealing with mortgage arrears should help clear up the household balance sheet and give consumers more breathing space,” said Barclays’ Blerina Uruci. “However there are still significant headwinds”.