Gross Domestic Product (GDP) fell by €2.2bn (1.7%) in Q4 2023, compared to Q1 2023 in current prices. Adjusted for inflation and seasonal factors (as published in the Quarterly National Accounts), it rose by 0.7% quarter on quarter.
Institutional Sector Accounts for the total economy are presented in current prices, not adjusted for inflation. GDP in Q1 was €125.5bn compared to €127.6bn in the same quarter last year. After accounting for the international flows of investment income, including outflows of profits by foreign multi-nationals, Gross National Income (GNI, B.5g) was €93.5bn, up €7.6bn (8.9%) on the €85.8bn seen in the January to March period of 2023.
The consumption of goods and services by households and government (P.3) was €50.6bn, an increase of €3.7bn (7.9%) compared to the last quarter of 2023.
Capital investment (P.5) was €26.7bn, 3.3% higher than the €25.9bn in the equivalent period last year. Investment in non-produced non-financial assets was €13.0bn, up from -€0.5bn in Q1 2023. After all transactions are included, Ireland was a net lender (B.9) of €1.9bn in the quarter, compared to €11.4bn in the first quarter of 2023.
Table 3.2 below is set out from the point of view of the rest of the world. That is, income received by Ireland from the rest of the world is shown as a negative.
As we saw in the chapter on Corporations, GVA decreased in the Manufacturing sector and this is reflected in a €13.4bn (15.1%) decrease in exports of goods to the rest of the world compared to the equivalent quarter in 2023. This was driven by a decrease in contract manufacturing (Goods for Processing) exports of €13.9bn. Exports of services grew by €14.0bn (16.2%) leaving total exports €0.6bn higher than Q1 2023.
Imports were €7.3bn higher at €128.0bn, resulting in a balance of goods and services of €48.1bn for Ireland, €6.7bn lower for Ireland since the first quarter of last year. This means that the country exports far more than it imports, but the positive balance is declining.
The reduction in exports means lower profits for corporations, particularly foreign-controlled multi-nationals. This in turn meant the return on investment flowing out of the country declined. As we saw, investment income (D.4) inflows increased in the quarter, and these two factors resulted in the net outflow decreasing by €9.8bn from €41.8bn to €32.1bn. This offset the change in the Balance of Goods and Services, and taking all current transfers together, the Current External Balance was -€14.9bn for the rest of the world (that is, the Current Account Balance was €14.9bn, up from €11.8bn in the first quarter of 2023.
Further details on transactions with the Rest of the World are provided by institutional sector in the International Accounts, which include the financial account as well.
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