Ireland’s economy shrinks at record pace

Agence France-Presse

Irish gross domestic product, or GDP, shrank by 7.5 percent - which was also a record decline - in the three months to December compared with the fourth quarter of 2007, the Central Statistics Office, or CSO, said in a statement. The Irish economy has been hit by the global economic downturn and the credit crunch, as well as a slumping property market, soaring unemployment and tumbling retail sales.

"For the year as a whole, GDP fell 2.3 percent in volume terms while GNP fell 3.1 per cent," the CSO said. Gross national product, or GNP, is regarded by the Irish government as a more accurate barometer of economic performance as it strips out profits earned by multi-national companies in Ireland which are taken out of the country.

"These are the largest annual declines since 1947 when the CSO was established," a spokesman said. He added that the 7.5-percent slide in the fourth quarter was "the largest ever decline since 1997 when the quarterly series began."

"The sharp acceleration in downward momentum that gripped the global economy in the final months of 2008 is evident," said Deirdre Ryan, economist at Goodbody Stockbrokers in Dublin. "The data underline the severity of the contraction in the final quarter with a 2.2-percent quarterly drop in GNP, implying the economy was on a weaker footing than previously thought."