Gross Domestic Product (GDP) fell by 4% in Q3 2023, compared to Q3 2022. Adjusted for inflation and seasonal factors (as published in the Quarterly National Accounts), it fell by 1.9% quarter on quarter.
Institutional Sector Accounts for the total economy are presented in current prices, not adjusted for inflation. GDP in Q3 was €128bn compared to €134bn 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 €104bn, up 12% on the €93bn seen in the July to September period of 2022. As we saw in the last chapter, Non-Financial Corporations had significantly higher inflows of income on their overseas investments this quarter, and this boosted GNI.
The consumption of goods and services by households and government (P.3) was €50bn, an increase of €4bn (9%) compared to the third quarter of 2022.
Capital investment (P.5) was €32bn, 11% lower than the €36bn in the equivalent period last year. After all transactions are included, Ireland was a net lender (B.9) of €19bn in the quarter, compared to €9bn in the third quarter of 2022.
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 €23bn (24%) decrease in exports of goods to the rest of the world compared to the equivalent quarter in 2022. This was driven by a decrease in contract manufacturing (Goods for Processing) exports of €19bn. Exports of services grew by €6bn (7%) leaving total exports €17bn lower than the third quarter of 2022.
Imports were €11bn lower, resulting in a balance of goods and services €6bn lower for Ireland, while the country still exports considerably more than it imports (the Balance of Goods and Services for the rest of the world was -€46bn this quarter compared to -€52bn in Q3 2022).
As we saw, investment income inflows increased in the quarter, and this resulted in the net outflow decreasing by €17bn from €41bn to €24bn. This offset the change in the Balance of Goods and Services, and taking all current transfers together, the Current External Balance was -€21bn for the rest of the world (that is, the Current Account Balance was €21bn, more than twice its level this time last year (€10bn)).
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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