The Irish economy grew by almost 10 per cent in the first quarter, up from a previous estimate of 3 per cent, as exporters rushed to get merchandise into the US ahead of the imposition of tariffs.
Central Statistics Office (CSO) data show the economy, as measured by gross domestic product (GDP), expanded by 9.7 per cent in January, February and March, one of the largest quarterly expansions on record.
The agency said the increase was “driven by significant growth in exports of goods”.
Total exports expanded by 9.4 per cent in the first three months, or by €18.2 billion, with goods exports increasing by 14.8 per cent quarter-on-quarter, or €13.5 billion. The value of goods exports for the period was 44.1 per cent higher than a year earlier.
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Since April 5th, goods imported from all countries into the US have been subject to a 10 per cent tariff while US president Donald Trump has put a stay on a possible 50 per cent tariff on all EU imports until next month.
Pharma accounts for the lion’s share of Irish goods exports to the US and companies in the sector here have been fast-tracking product to avoid incoming tariffs.
The CSO’s figures show the pharma-dominated industry sector expanded by 17.1 per cent in the first quarter compared with the previous three-month period.
By contrast, the domestic economy, as measured by modified domestic demand (MDD), grew by a more modest 0.8 per cent in the first quarter as personal spending on goods and services, a key driver of domestic activity, increased by 0.6 per cent.
The information and communication sector, which contains the State’s tech industry, posted an increase of 3.8 per cent over the same period.
Commenting on the figures, Minister for Finance Pascal Donohoe said: “I note the substantial quarterly increase in Gross Domestic Product of 9.7 per cent in the first quarter of this year.”
“This was driven by a significant increase in the export of goods, and reflects, in large part, the ‘front-loading’ of exports in anticipation of the imposition of tariffs by the US administration,” he said.
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“This is also a feature in other countries, though the scale is much larger in Ireland. My officials assess this as likely to be temporary – with exports and GDP likely to moderate over the course of this year,” Mr Donohoe said.
“Today’s results highlight, once again, that GDP is not an accurate reflection of economic activity happening on the ground.”
Nonetheless Mr Donohoe said the latest figures confirm the relatively strong position of the domestic economy at the start of this year.
“Looking ahead, however, the economic outlook has become increasingly challenging. Indeed, the significant increase in uncertainty is likely weighing on growth,” he said.
His department warned last month that growth would be slower with as many as 25,000 fewer jobs being created in Ireland if the European Union (EU) fails to secure a trade deal with the US to limit the impact of tariffs.
Separate figures from the CSO put the State’s seasonally adjusted unemployment rate in May at 4 per cent, down from a rate of 4.1 per cent.
Goodbody’s chief economist Dermot O’Leary said: “The volatility in the Irish data, due to the large presence of US multinationals, is likely to continue over the coming quarters, with some payback for the strength in exports in Q1 likely.
“Looking through this volatility, the underlying story is one of steady, if unspectacular, domestic spending.”
Robert Purdue, head of dealing at Ebury (Ireland), said the latest GDP estimates showed “that the Irish economy kicked off 2025 to a racing start”.
“Irish exports took the lion’s share of this growth as many businesses rushed to export goods to the United States before President Trump’s tariff sanctions came into effect,” he said.
