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Republic's 6.7% growth strongest in the eurozone

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Economic growth in the Republic came in at 6.7% in 2018, and although it slowed in the second half of the year, Ireland still experienced the most rapid growth of any eurozone country since 2014.   (Niall Carson/PA)

Economic growth in the Republic came in at 6.7% in 2018, and although it slowed in the second half of the year, Ireland still experienced the most rapid growth of any eurozone country since 2014. (Niall Carson/PA)

PA Archive/PA Images

Economic growth in the Republic came in at 6.7% in 2018, and although it slowed in the second half of the year, Ireland still experienced the most rapid growth of any eurozone country since 2014. (Niall Carson/PA)

Economic growth in the Republic came in at 6.7% in 2018, and although it slowed in the second half of the year, Ireland still experienced the most rapid growth of any eurozone country since 2014.

Strong exports were again behind the development, according to data released by Ireland's Central Statistics Office (CSO) yesterday.

There were also welcome signs that consumer demand was kicking in as the shock of Brexit loomed and higher public sector salaries fed through.

The fourth quarter saw GDP growth slow to 4.9% from a year earlier, and the economy expanded just 0.1% on the third quarter, largely due to a strong performance in the third quarter.

Despite the slowdown, growth was still well above the 1.8% pace recorded in the 19-member single currency bloc.

"Importantly, the growth in the economy is broad-based, with positive underlying contributions from both the domestic and multinational sectors," the Republic's Minister for Finance, Paschal Donohoe, said.

Gross national product, which gives a better picture of the performance of the economy, expanded by 5.9%, and there was growth in investment and government activity, as well as in consumer spending.

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Exports in the full year rose 8.9% on 2017 and were the driving factor behind the growth numbers, the CSO said.

The export market to Britain is worth €14bn (£11.9bn) a year to the Republic, and the minister highlighted the risks to the economy from tariffs and other risks posed by the UK's withdrawal from the EU.

"The Brexit cloud hangs over the economy and, as I outlined in January, the impact on the most exposed sectors of the economy could be severe," Mr Donohoe stressed.

Farming groups in Ireland say the €800m (£682m) a year market for beef will simply disappear if the industry loses tariff-free access to the UK and meat from non-EU states is allowed in on the same terms as Irish products.

The economic picture looks set to darken in 2019, largely thanks to Brexit, although growth was expected to moderate to the 4% to 4.5% range put forward by most forecasters.

However, estimates from the Central Bank suggest that in the event of the UK leaving without a deal, growth in the Republic could fall to as little as 1.5%.

Other economic data released yesterday suggested there were few signs that rising wages were feeding through to push inflation higher.

The headline annual rate of inflation came in at 0.6% in February, down from 0.7% in the previous two months.


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