Ireland’s economy grew at a robust rate of nearly 5 per cent last year as consumers spent more on goods and services and exports from the multinational-dominated IT sector accelerated.
The Central Statistics Office‘s (CSO) latest national accounts show the economy, in modified gross national income (GNI*) terms, expanded by 4.8 per cent in 2024.
This was marginally down on the 5 per cent recorded the previous year but well above the European average.
GNI* is the CSO’s bespoke measure of national income, designed to weed out the distortionary effects of multinationals.
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The agency said personal spending on goods and services, a key measure of domestic activity, increased by 2.9 per cent last year as wages rose faster than inflation, giving consumers a real income boost.
“Domestic-dominated sectors” expanded by 3.6 per cent in 2024 while multinational-dominated sectors increased by 1.5 per cent.
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“There were higher levels of economic activity for most sectors focused on the domestic market in 2024,” the CSO said, noting the financial and insurance sector expanded by 16.1 per cent while the real estate activities sector expanded by 6 per cent.
The globalised industry sector, which includes the State’s big pharmaceutical sector, contracted by 0.5 per cent in 2024 when compared with 2023, the second consecutive year of contraction.
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However, the information and communication sector continued to grow, increasing by 6.2 per cent in the year.
Gross domestic product (GDP), the traditional measure of economic growth, expanded by 2.6 per cent in 2024, the agency said.
It also revised downwards its earlier 9.7 per cent estimate of GDP growth for the first three months of 2025 to 7.4 per cent.
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The globalised industry sector expanded by 16.5 per cent in first quarter as pharma firms here rushed to stockpile product in the US before the imposition of tariffs in April.
Pharmaceuticals, Ireland’s biggest goods export, currently remains outside the scope of US tariffs, providing the State’s export trade some cover.
However, the US has reportedly threatened to hit European Union (EU) agricultural exports with 17 per cent tariffs, a move that could hurt food and drink exporters here.
The EU has been given an additional three weeks, to August 1st, to negotiate an agreement with the US to avert an escalation of tariffs.
Minister for Finance Paschal Donohoe said the figures pointed to “robust growth in the domestic economy last year” which was consistent with the continued momentum in the labour market.
“Looking ahead, we are facing into a period of considerable uncertainty in the global economic environment relating to the introduction of tariffs and the rise in geo-fragmentation,” he said.
“Given the globally integrated nature of the Irish economy, this uncertainty will act as a headwind to Irish growth,” Mr Donohoe said.
