Irish gross domestic product contracts amid fall-off in pharmaceuticals
According to the CSO's preliminary GDP estimate for the second quarter, GDP is estimated to have contracted by 1% quarter-on-quarter.
It said this was driven by a decrease in the multinational-dominated industry sector, which includes pharmaceutical companies.
The contraction comes after a period of significant expansion in the pharmaceutical and exports sector during the first three months of the year, as companies rushed to get as much product to the US prior to US president Donald Trump implementing tariffs.
Mr Trump announced his tariff plans on April 1 — which initially set a tariff of 20% on imports from the EU — before he backtracked and set the tariff rate for all imports into the US at 10%. Following a deal on Sunday, EU tariffs will be set at 15%.
While GDP might be down quarter-on-quarter, it is still up 12.5% compared to the same period in 2024, reflecting continued strong multinational growth in 2025.
GDP is not the most accurate measure of the strength of the domestic Irish economy owing to the presence of numerous multinational corporations here. The activity of these companies have a significant impact on the final GDP figures.
For this reason, the preferred measure of the domestic economy is modified domestic demand, as it strips out the activity of the multinationals and only accounts for personal spending, government spending, and investment spending.
The CSO said these preliminary results were subject to revisions in the next quarterly national accounts release.
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