| Click for the Finfacts Ireland Portal Homepage |

Finfacts Business News Centre

Home 
 
 News
 Irish
 Irish Economy
 EU Economy
 US Economy
 UK Economy
 Global Economy
 International
 Property
 Innovation
 
 Analysis/Comment
 
 Asia Economy

RSS FEED


How to use our RSS feed

Follow Finfacts on Twitter

 
Web Finfacts

See Search Box lower down this column for searches of Finfacts news pages. Where there may be the odd special character missing from an older page, it's a problem that developed when Interactive Tools upgraded to a new content management system.

Welcome

Finfacts is Ireland's leading business information site and you are in its business news section.

Links

Finfacts Homepage

Irish Share Prices

Euribor Daily Rates

Irish Economy

Global Income Per Capita

Global Cost of Living

Irish Tax - Income/Corporate

Global News

Bloomberg News

CNN Money

Cnet Tech News

Newspapers

Irish Independent

Irish Times

Irish Examiner

New York Times

Financial Times

Technology News

 

Feedback

 

Content Management by interactivetools.com.

News : Irish Economy Last Updated: Jan 11, 2013 - 7:20 AM


Irish Economy: Industry body says exports grew to €183bn in 2012 -- fact or fiction?
By Finfacts Team
Jan 11, 2013 - 2:34 AM

Email this article
 Printer friendly page
Exporter of the Year Award 2012: Kent Stainless, Wexford: Colin Lawlor, president IEA, Anne O'Brien, managing director, Kent Stainless, and Richard Bruton, enterprise minister, Dublin, Nov 23, 2012. Photo: Paul Sherwood

Irish Economy: The Irish Exporters Association (IEA), the private sector industry body, says exports grew by €9bn in 2012 to €183bn. However, the official headline value of exports in 2011 was  €164.3bn. So the claim of €183bn is the first fiction.

The CSO revises its initial value of annual merchandise exports, mainly offsetting transhipments to Northern Ireland, in its March Balance of Payments statement that accompanies fourth quarter growth data. The official value of merchandise and services exports in 2011, are detailed on Page 4 of the March 22, 2012 BoP statement [pdf].

The IEA says Irish exports grew by 5% in the year, "which was double the world trade growth, and shows a return to competitive strength in many sectors of Irish industry."

This narrative is the second fiction.

The IEA says services exports were the main driver of export growth last year, with an 11% growth which "consolidated Ireland’s ranking as the 9th largest global exporter of services."

Manufactured goods exports showed no growth in the year. Growth took place in medical devices exports of 6% and in agri-food exports of 2%,however exports of computer hardware continued their long term decline and fell by 16% , and pharmaceutical and chemical exports showed no growth as the off –patent drugs peaked in impacting the sector in 2012.

Looking forward, the IEA says it is confident that export growth in 2013 will once again be over 5% and increase to 7% in 2014.

John Whelan, chief executive of the IEA said at the launch of the annual review: "Ireland’s export growth at twice the world trade average for 2012 shows a strong return to competitiveness in many our businesses.

"Ireland is now seen as the prime location in Europe for hi –tech mobile, internet and social media technology companies. There is no doubt that there is a direct link between the increased success in this sector and our increased competitiveness, which if maintained will enable ensure significant long term jobs growth. Services exports now account for 49% of total exports and are expected exceed 50% next year.’’

Last year we estimated that at least a third of the value of services exports relate to tax strategies and it could be as high as 40%. So for example when Google books almost half its global revenues in Ireland for tax purposes, it feeds into the delusion that exports are rising when they are not. Never underestimate the Irish and international market for fairytales.

As to the statement: "There is no doubt that there is a direct link between the increased success in this sector and our increased competitiveness, " there should be no doubt that this is a very misleading claim.

The biggest services exporters are the funders of the IEA. 

The IEA chief executive referred to the lack of growth in exports to the fast growing BRICS (Brazil, Russia, India and China) markets, where exports fell for the second consecutive year: "Our competitors in other EU countries have rapidly grown their exports to the BRICS countries to the point that they now account for 22% of total EU 27 exports, whereas exports from Ireland still only account for 4% of total Irish exports. This is a very worrying trend as 90% of global trade growth is expect to come from the emerging markets outside of the EU over the next decade ‘’

Most of the 4% relate to multinational exports and decisions on destination of output are not generally made in Ireland.

An example of the fantasy world of spin is provided by the Irish Examiner today: ‘Amazingly strong’ year for exports  - - It's essentially a lie and these additional exports are as bogus as the paper wealth creation by Wall Street during the credit bubble.

A copy of the IEA review should be available here sometime Friday.

The following illustrates the high revenues/exports of €12.4bn booked by Google in Ireland in 2011 and the low value-added e.g. payroll costs were €218m.

Google UK is responsible for 10% of Google Inc's revenues which amounted to $37.0bn in 2011 -- so Google UK should report sales revenues of about $4bn.

Google UK has a staff of 1,300.

Most of the revenues are booked in Ireland and the same applies with Google France and all other EMEA markets (Europe, Middle East, Asia).

It has been reported in France that its revenue agency has demanded €1bn in taxes from Google. It reported only €138m of revenue in France in 2011

  • Revenue in France in 2011: €138m
  • Revenue in UK: £395m; admin expenses of £416.8m
  • Revenue in Ireland in 2011: €12.4bn - - this is also treated in Ireland as Irish services exports
  • Gross profit in Ireland in 2011: €9bn
  • Net profit in Ireland after €9bn in 'administrative expenses' €24m; payroll costs for 1,900 people in Ireland: €218m
  • Tax in Ireland on trading activities €3m; total tax charged at €22.2m including foreign withholding tax
  • Tax in the UK in 2011: £6m mainly related to staff stock options 
  • Tax in France in 2011: €5.5m

SEE also:

Irish Economy: Innovation, a failed enterprise policy and inconvenient facts for 2013

Irish Economy: Actual Individual Consumption per capita in Ireland at EU average; Germany at 20% above

Irish Economy: Pharmaceutical patent cliff no growth threat; High exports have low impact

Irish Economy: Export growth insufficient to pull domestic economy out of recession

Irish Economy 2012: At least a third of value of Irish services exports is overstated

Dell remains Ireland's biggest manufacturing exporter despite closing Limerick plant

Irish Economy 2012: Only 50,000 Irish direct workers responsible for 69% of annual Irish exports

Irish Economy: Sustainable growth dependent on foreign firms since 1990; Now FDI has peaked

Check out our subscription service, Finfacts Premium , at a low annual charge of €25 - - if you are a regular user of Finfacts, 50 euro cent a week is hardly a huge ask to support the service.

Related Articles


© Copyright 2011 by Finfacts.com

Top of Page

Irish Economy
Latest Headlines
Irish Economy 2014: Live Register numbers + schemes at 469,00 in July
Irish Economy: Bruton publishes new FDI policy; Avoids inconvenient facts
Irish Economy: Central Bank raises 2014 forecasts
Irish corporate tax policy like property bubble driven by short-term interests
Irish Economy: Retail sales volume up 4.8% in year to June; Ex-cars at 3.6%
Irish income inequality fell during the economic bust
Irish Economy: Bruton and politics of jobs numbers; How to add 50%
Corporation Tax Reform: Irish Government should reject pleadings of short-termists
Irish Economy: Bruton's claim of 70,000 jobs added in past 18 months is not correct
FDI in Ireland: Grant Thornton publishes promotional brochure not balanced report
Irish Banking Inquiry: Advisory group says begin crash saga 20 years ago
Moody's forecasts Irish growth rates "of at least 3% for the next few years"
Irish National Competitiveness Council fails to separate wheat from the chaff
Irish SME Finance: Oireachtas committee calls for less dependency on traditional banking
Irish Economy: Merchandise exports up 15% in May
Irish industrial production fell in May; up 32.3% in 12 months & 16.4% in period 2010-2014
Irish indigenous tradeable exports at 9% of total headline exports in 2013
Irish consumer prices up 0.4% in 12 months to June 2014
Official Irish services index fell in May; PMI survey level was at highest since 2007
US-Ireland Tax Inversions 600,000+ staff: Kenny, Noonan met with top US corporate lawyers
IDA Ireland: Jobs in Irish FDI exporting sector remain below 2000 level
Bord Gáis Irish Energy Index unchanged in June; Up 33% since December 2009
Irish Budget 2015: Ibec urges personal & business tax breaks; No wage hikes
German Bundestag committee warns Ireland has no plan for long-term growth
Irish Economy 2014: Recovery on track; keep champagne on ice
Forty American firms account for two-thirds of Irish exports
Irish pension managed funds returns were in range 6% to 7% in H1 2014
Irish Economy 2014: GDP up 2.7% in Q1; GNP up 0.5% - personal spending/ investment weak
Irish Economy 2014: Tax revenues €500m ahead of target; Social Protection spend down €20m
Irish Economy 2014: Services surge but Reality Check required
Irish Live Register + activation program total at 475,000 in June - 22% of workforce
Irish manufacturing output rises but not matched by sales value
Irish health spending among highest of developed world; Consultants best paid
Irish wholesale gas prices close to 4 year lows
In 2012 20,200 adults from ex-European Economic Area became Irish citizens
US tax inversions screw-up Ireland's national accounts; Bring few benefits
Irish Economy 2014: Volume of retail sales ex-cars fell in May
Irish SME firms' weighted default rate at 41%; Credit situation like Greece
Enterprise Ireland doesn't know how many active client firms it supports
Irish Economy: Economics institute says ‘Do Nothing’ stance in Budget 2015 insufficient