Value added for Multinational-dominated sectors increased in 2020, all other economic sectors declined

Value added for the Industry (excluding Construction) and Information & Communication sectors recorded increases of 15.2% and 14.3% respectively in real terms in the year, see Table 2.4. Distribution, Transport, Hotels & Restaurants declined by 16.7% year-on-year while Professional Admin and Support Services decreased by 15.5%. Construction recorded a decline of 12.7% in volume terms in 2020 compared to 2019, while the Arts & Entertainment sector declined by 54.4%. Other sectors exhibited modest, low single digit percentage declines in the year. (Public Administration, Education & Health -1.1%, Real Estate activities -1.7%, Financial & Insurance -1.2% and the Agriculture, Forestry & Fishing sector -1.6%).

Intellectual Property effects in Imports and Capital Investment, Impact of COVID-19

On the expenditure side of the accounts (Table 3.4), Capital Investment, driven by Intellectual Property Products (IPP), declined by €49.0 billion during 2020 while Personal Consumption Expenditure, which accounts for just over 40% of Domestic Demand, fell 9.0% compared with the previous year. Government expenditure increased by 9.8% over the same period.  Final Domestic Demand decreased by 19.3% in 2020 compared with 2019 while Modified Domestic Demand decreased by 5.4% over the year.

Exports grew 6.2% during the year while Imports decreased by 11.3%, driven to a considerable extent by a fall in IPP investment compared with 2019. Overall net exports for the year increased by €73.4 billion which when combined with the 19.3% fall in domestic demand resulted in an overall increase in real GDP in 2020 of 3.4%. Factor income outflows were 12.7% higher in 2020 (+€10.2 billion) compared with 2019 leading to an overall increase in real GNP of 0.6%.

While Industry (excluding Construction) changed little in the quarter, Information and Communication declined by 16.5% in Q4 while the domestically dominated Distribution, Transport, Hotels & Restaurants sector decreased by 1.9%.  Quarter-on-quarter increases were recorded in Professional & Administrative services (3.6%), Construction (16.5%), Real Estate (3.6%), Finance & Insurance (1.6%), and Agriculture (1.5%). The Arts & Entertainment decreased by 1.7% over the period compared with Q3 2020. (See Table 2.6)

On the expenditure side of the accounts (Table 3.6), Capital Investment, exhibited an increase of €6.4 billion in Q4 compared with the previous quarter and accounted for 42.2% of domestic demand in Q4 2020. Imports increased by 24.4% in Q4 2020 compared with Q3 2020 while Exports increased by 4.2% which meant that overall net exports for the quarter were 31.5% lower in Q4 compared with Q3 or €13.6 billion lower in money terms quarter-on-quarter. These two impacts combined resulted in an overall decline in the real GDP growth rate in Q4 2020 of 5.1%. With Personal Consumption Expenditure down by 2.3% in Q4 compared to Q3, Final Domestic Demand increased by 8.7% in Q4 compared with Q3 while Modified Domestic Demand fell by 2.2% over the same period.

Factor income outflows were €10,257m lower than in the previous quarter leading to an overall increase in GNP of 8.5% for the fourth quarter compared with the previous quarter.