Economy hit by 7% slump in first 3mths

..but Finance Minister says overall figures are positive

THE economy grew strongly last year – but began to shrink at the start of 2017, official figures revealed. And when cash channelled through the country by multinationals is removed the slump in the first three months of this year is 7.1%. Despite the short-term dip, Finance Minister Paschal Donohoe said the numbers were very positive. He added: “This confirms that Ireland was the fastest growing economy in the European Union in 2016.” The Central Statistics Office, which is now using new techniques to more accurately value business performance, said the traditional yardstick of measurement – gross domestic product – showed the value of goods and services grew by 5.1% in 2016. In the first three months of this year this standard assessment showed the economy shrank by 2.6% compared to the strong performance at the end of last year. The CSO also revealed when gross national product numbers are examined, which discount the effects of multinationals, the economy dipped by 7.1% in quarter one. Mr Donohoe said the economic report also backed up improving employment figures and tax receipts. The CSO, which was accused by economist Paul Krugman of “leprechaun economics” after reporting the economy grew at 26% in 2015, also issued an alternative measurement of growth. Gross National Income is an attempt to strip out performance that heavily distorts Irish economic reports and it will not include multinational profits or depreciation of assets in multibillion industries. It was valued at €189billion in 2016.