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The same applies to Ireland's GNP figures which are religiously compiled in compliance with international conventions. However when large global corporates based in Ireland moved huge assets from one section of their balance sheets into their Irish companies this resulted in us recording 26% GNP growth in 2015!

When Paul Krugman dubbed this "Leprechaun economics" the government had no option but to try to develop a bespoke measure which stripped out the balance sheet activities of global corporates and more accurately reflect real economic activity in Ireland. It is called GNI* (Gross National Income).

However the EU still use the traditional GNP measure when calculating Ireland's contribution to the EU budget, which means that the financial engineering activities of global corporates have real implications for Irish Government costs and results in Ireland being a net contributor to the EU budget for some years.

Some of the Global corporates activities may be pure tax optimisation strategies, but others are genuine transactions - for instance when air plane leasing firms based in Shannon place orders for hundreds of Boeing or Airbus Jets at a time  to a value of several Billion. This results in huge fluctuations in our export/import and balance of payment figures which can make real underlying trends difficult to discern.

The national statistics office is coy about releasing more detailed breakdowns which might identify the firms behind these fluctuations as this may be "commercially sensitive" information. So we still don't have fully accurate figures for our export performance...

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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Aug 26th, 2019 at 08:17:22 PM EST
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