Ireland's economic growth for 2015 was revised to 26.3 percent from 7.8 percent. The dramatic revisions released on Thursday primarily reflect reclassifications and relocations of a handful of companies that are very large by Irish standards. The developments increase the productive capital stock of the Irish economy from about €700 billion to around €1050 billion.
The revision has no lasting impact on future economic growth rates. However, it does suggest the possibility of greater volatility in quarterly GDP data going forward. The scale and nature of companies and activities recently included in the GDP data mean they won’t necessarily mirror the contours of the rest of Irish economy. Poor start to 2016 and Brexit risks mean potentially softer growth rate likely.
The revised numbers have potentially important implications for Budget policy. A major re‐think is required to formulate fiscal rules that are likely to lead to sustainable and healthy trends in Irish public finances.
