Ryanair tends to grow faster in a recession, according to its boss Michael O’Leary. He might well be talking about the Irish economy.
At the height of the pandemic in 2020, when the global economy was in and out of lockdown, the economy here grew by almost 6 per cent in gross domestic product (GDP) terms while the rest of the world sank into recession.
And now, amid Trump’s tariff-induced snafu, the Irish economy looks set to be the fastest-growing advanced economy in the world again.
The Department of Finance and Bank of Ireland expect GDP growth to be close to 11 per cent this year. The bank linked the upward revision to “a buoyant pharmaceutical sector, resilient consumer spending and strong public investment”.
In reality the double-digit GDP prediction reflects the stockpiling of pharmaceutical exports in the US in advance of Trump’s tariffs in the first part of the year, which temporarily turbocharged exports and GDP in the process.
“Despite global headwinds, Ireland’s defensive export profile, particularly in pharmaceuticals and ICT, continues to shield it from volatility,” the bank’s chief economist, Conall Mac Coille, said.
Some €58 billion of €73 billion worth of Irish goods shipped to the US last year were pharma-related, which, for now, remain outside the tariff dragnet.
And while Trump has threatened to hit pharma companies with a 100 per cent tariff unless they manufacture in the US, his actions in recent weeks have signalled something else.
His administration has struck deals with pharma companies such as Pfizer and AstraZeneca to avoid tariffs, a boon for them and for Ireland as well.
That leaves roughly €15 billion – just 2 per cent of the State’s total €809 billion export trade in goods and services – in the line of fire from tariffs.
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No doubt bad for the companies involved – the independent whiskey producers reliant on the US market, for instance – but not something that is going to cause a wider economic reversal.
There is increasing evidence that Ireland will weather Washington’s protectionism better than most.
