The Central Statistics Office said it has held "intensive discussions" with the EU's statistics agency on the recent sharp revision of Ireland's economic growth last year to 26 per cent.
"Eurostat has held intensive discussions with the CSO on the changes to our National Accounts and Balance of Payments statistics, driven by the location of capital assets in Ireland and accepts the recent [gross domestic product] revisions," Jennifer Banim, assistant director general with the CSO, said.
A planned mission by Eurostat staff to Ireland next month, reported by The Irish Times on Thursday on receipt of records released under the Freedom of Information Act, amounts to "final verification" of the data.
Eurostat said in the internal document, circulated to Irish officials last month, that the initial explanations provided by Ireland for the surprising data “look plausible”.
‘Routine process’
“The forthcoming Eurostat visit is part of an ongoing routine process of verification of GDP and GNI (gross national income) figures for all states,” Ms Banim said.
The GDP revision on July 12th has prompted widespread criticism among economists about the relevance of the data, which has skewed various widely-followed gauges, including Government debt relative to the economy’s size. Moody’s, one of the world’s main credit ratings agencies, said at the time that the country’s highly volatile economic performance is one of its main concerns about the country’s creditworthiness.
The surge, including the impact of US companies merging with Irish firms to gain a tax benefit, contract manufacturing and aircraft leasing activity, served to push Ireland’s debt level below 80 per cent of GDP compared to previous estimates of 94 per cent.
While the CSO calculated GDP along Eurostat criteria, Nobel Prize-winning economist Paul Krugman famously said last month the Irish figures were best summed up as "leprechaun economics".
The GDP statistics “accurately reflect the complex and highly globalised nature of the Irish economy,” Ms Banin said. “In this context, the figures are highly relevant and plan an important role in understanding the complexity of our economy.”
‘Measurement challenge’
However, she said the recent revisions “present a significant measurement challenge” for the CSO, Eurostat, United Nations and International Monetary fund.
Meanwhile, a high-level Irish working group looking into the appropriateness of GDP data to measure the underlying Irish economy is due to report back to the CSO by the end of October. Their findings are set to be published thereafter.
The group should look at developing and expanding existing economic indicators, potentially developing new ones and presenting existing data in new ways to improve understanding.
However, the Eurostat document said “it should be clear, nevertheless, that neither the Irish CSO nor Eurostat intend to publish any ‘alternative GDP’ data.”
