THE UNITED States is to replace the UK as Ireland’s largest trading partner by 2025, according to a report commissioned by HSBC.
HSBC Trade Connections also predicts that Ireland’s trade volumes will grow by 71 per cent over the next 15 years. This increase will be largely driven by pharmaceuticals and agri-business exports, though all of the State’s core import and export sectors are forecast to grow.
Trade growth is likely to be slow for the next two years, but is expected to pick up towards the end of 2013.
Of Ireland’s top five trade partners – the US, the UK, Belgium, Germany and France – trade with the US is expanding at the fastest pace. It is anticipated pharmaceutical exports to the US will increase at an annualised rate of 11 per cent over the next 15 years to $1.7 billion (€1.24 billion), while exports in the agri-business sector will grow at a rate of 6.15 per cent a year.
Based on HSBC’s predictions, by 2025 trade volumes with the US will hit $43.3 billion, overtaking trade to the UK, which will have risen to $42.7 billion.
Though Ireland’s trade depends heavily on its links with the UK and the US, new trade corridors are now opening up and developing strongly. “India and Poland are growing substantially and agri-business and pharmaceuticals are core to these corridors and to Ireland’s restored economic confidence,” it says.
Agri-businesses in particular look to benefit from links with US, Poland and India, as trade in this sector is forecast to grow at twice the rate of more more general trade.
The report predicts that world trade will expand by 73 per cent in the next 15 years, driven by emerging economies.
Ireland must maintain momentum in making cuts in public expenditure, a new report from stockbrokers Goodbody said yesterday, noting the Government faces “unpopular choices” to reach its deficit targets.
The economy is still living beyond its means, the report said. Although public spending is no longer low by EU standards, the economy remains a low-tax one.
