FALLING IMPORTS helped narrow Ireland’s balance of payments, according to figures published yesterday by the Central Statistics Office.
The current account deficit on the balance of payments fell to €2.5 billion in the first quarter, over €1.6 billion lower than the same period last year. The balance of payments is a key economic indicator which measures the economic transactions between a country and the rest of the world.
The decrease in the current account deficit for the first quarter of this year means that, while Ireland still imported more than it exported, the rate of decline in imports was steeper than the decline in exports. The figures show that while the level of imports was affected by the fall in domestic demand, Ireland’s export sector remains robust.
Exports of goods and services fell 3 per cent compared with the same period last year, with goods down 3.1 per cent and services down 2.8 per cent.
However, imports of goods and services declined by 11.7 per cent on an annual basis, with goods down 25 per cent, but services up 0.2 per cent.
Economist Alan McQuaid of Bloxham Stockbrokers said the performance of the export sector was welcome. “Given that the export side will be key to the Irish economic recovery, the fact that exports are performing relatively well despite a weak global economy augurs well for the future,” he said.
However, the debt held by monetary authorities, which includes the Central Bank and the FSA, mushroomed to €94.86 billion, more than double the previous quarter, reflecting an increase in liabilities to the European System of Central Banks. The liabilities of “other sectors” which includes insurance funds and asset finance companies, increased by 4.7 per cent from the previous quarter, to over €620 billion.
