Minister Donohoe welcomes CSO data showing continued robust growth in domestic activity in the third quarter

15th December, 2017

  • In the third quarter of this year, real consumption rose by 2.7 per cent on an annual basis and building and construction investment was up over 7 per cent.
  • Real GDP rose by 4.2 per cent relative to the previous quarter; as a result the level of economic activity was 10.5 per cent higher than the same period last year.
  • The very strong growth in headline activity was driven by exports linked to contract manufacturing.
  • The average annual growth rate in the first three quarters of 2017 was 7.4 per cent.

The CSO today (Friday) published national accounts estimates for the third quarter of this year. Commenting on the figures, Minister for Finance and Public Expenditure & Reform, Paschal Donohoe TD, said: ‘Today’s figures are very strong showing that the Irish economy grew by 10.5 per cent in annual terms in the third quarter of this year. While the headline GDP growth rate was driven by the multinational sector and in particular exports linked to contract manufacturing, the domestic economy also made a strong positive contribution with private consumption up 2.7 per cent on an annual basis’.

“These figures are mirrored in strong employment growth as well as tax receipts to end-November which increased by 6 per cent over the same period last year.

“My Department forecast real GDP growth of 4.3 per cent in Budget 2018. On the basis of today’s data, the outturn for this year is likely to be above the Department’s projections. Having said that, it must be acknowledged that a key factor behind the stronger-than-expected growth was exports associated with contract manufacturing which has little, if any, impact on domestic activity.

“Notwithstanding the well-known limitations with GDP and GNP, it is clear that the recovery continues to outperform expectations and while this is to be welcomed, it creates its own challenges. In particular, if the economy continues to grow in excess of its potential, capacity constraints will begin to emerge. In these circumstances, it is essential that budgetary policy does not contribute to overheating. This is one of the defining economic challenges facing the Government over the coming years.”