Irish services exports grew rapidly in the first half of 2010, but job creation may not return to the sector until next year, the Irish Exporters Association (IEA) said today.
However, chief executive John Whelan said there were still "a number of obstacles" that needed to be tackled before sustainable export-led growth for the Irish economy emerged.
In its first-half review of the industry, the IEA said sector rose by €2.2 billion to €34.6 billion in the first half of this year. Services now account for 45 per cent of total Irish exports, it said.
Mr Whelan said that only 3.5 per cent of Ireland's services exports come from Enterprise Ireland clients, and there were indications that few Irish businesses have moved into international markets. He called for incentives to be extended to companies through an export outreach voucher scheme.
"As the economy recovers from the worst recession for 80 years, it faces a range of challenges that require ambitious policy responses and novel type of incentives," he said.
"Many services companies who have only traded on the home market are now struggling, and shedding jobs ; with the right assistance into international markets, they could be critical drivers of growth and job creation."
Merchandise exports rose 5 per cent in the second quarter of the year, a rise of €1 billion compared with the first three months of 2010 but the figure for first half of the year was still 4 per cent down on the same period in 2009.
“This represents the first quarterly growth in merchandise exports recorded since the beginning of 2009, and indicates we may now have reached the turning point in the decline in Irish merchandise exports brought on by the global financial crisis,” said Mr Whelan.
“Undoubtedly this means that Irish merchandise exporters have been losing international market share and it becomes perfectly clear that as a country we must continue to maintain our focus on restoring cost competitiveness.”
The global increase in commodities prices helped return the Irish agri-food sector to growth during the second quarter of this year. The sector rose 3 per cent in the first half of the year, but still lag behind figures recorded in 2008 by 10 per cent.
However, there are some positive trends emerging, Mr Whelan said, with a rise of 13 per cent in the beverages sector in the first six months of the year. Meanwhile, the fluctuating exchange rates have also helped, with exports to the UK and US benefiting from the decline in the euro against sterling and the dollar.
"This level of exchange rates, should they remain, will undoubtedly continue help merchandise exports to recover lost business," said Mr Whelan.
