Ireland has fallen back into recession, according to preliminary figures released yesterday by the Central Statistics Office.
The country’s GDP declined by 0.2 per cent over the fourth quarter of 2011, marking the fourth consecutive quarterly decline. Over the same period Gross National Product declined by 2.2 per cent.
While the figures are still subject to revision, if they prove accurate it would mean that Ireland joins Belgium, Greece, Italy, the Netherlands, Portugal and Slovenia in recession.
A major drag on growth came from the building and construction sector, which saw a contraction of 13.5 per cent over the quarter. Meanwhile personal consumption, which accounts for two-thirds of domestic demand, fell by 2.7 per cent.
For the Irish government the GNP is a particularly worrying figure as it represents a substantial decline in taxable income from Irish firms. Problems in Ireland might also pose a difficulty for European politicians who have seen the country as the poster-child for the value of austerity measures.