Bank of Ireland: Irish economic growth is at a five year high
Average Irish income (GNP) is now rising faster than output (GDP), a departure from the historical norm, reflecting the strength of income earned on Irish investments abroad, according to Bank of Ireland’s quarterly economic outlook, which was published today.
The country is now a high-income economy and exports a substantial amount of capital, the return on which has boosted Irish incomes. GNP growth was estimated at 7% in 2006, with 6.2% forecast in 2007 and 5.2% in 2008.
Bank of Ireland’s chief economist Dan McLaughlin said: “A few years ago we noted that the Irish economy was in transition to a new growth phase, which would see the economy at full employment, with output constrained by a scarcity of labour, so limiting potential growth to around 6% with domestic demand taking over from exports as the main driver.
“As we enter 2007, it is clear that this transition has successfully taken place where growth has averaged 5.3% over the five-year period to 2006, despite export growth of circa 5% per year with a notable acceleration evident in the past 18 months.
“Indeed, annual growth rose to 7.7% in the third quarter of last year, although for the year as a whole, we estimate GDP growth of 6.5%, the best performance since 2000, with 6% forecast for 2007 and 5% for 2008.”
Overseas assets boosting growth - BoI
Bank of Ireland says average Irish income (GNP) is now rising faster than Irish output (GDP) reflecting the strength of income earned on Irish investments abroad
Irish economy to grow by 6.2pc in 2007