Press Statement

Preasráiteas

30 October 2020

Go to release: Institutional Sector Accounts Non-Financial and Financial 2019

The Central Statistics Office (CSO) has today (30 October 2020) released Institutional Sector Accounts - Non-Financial and Financial, 2019, which brings together comprehensive information on the economic activities of households, businesses – both domestic and foreign-owned – and the government sector. The report also links relevant financial and non-financial information for each of the sectors.

Commenting on the release, Statistician Peter Culhane noted 'We've seen household saving stabilising at a high level in recent years, and in 2019 this translated into a significant increase in money on deposit. Irish households generated gross savings of €13.9bn in 2019 – up from €12.4bn in 2018.'

Expressing household saving as a proportion of the gross disposable income of households the derived saving ratio rose from 11.6% in 2018 to 12.2% in 2019, around the same ratio as for the EU as a whole.

Household saving was used to increase investment in property and deposits. For the first time, the growth in household saving on deposit was equal to the new investment in new homes and other fixed capital.

Non-financial corporations investing more

Investment by foreign multinationals in Ireland was €125bn in 2019 up from €60bn the previous year, as these companies continued to import large intellectual property assets. Domestically-owned corporations showed slower, steadier growth in investment at around the same rate as the EU average.

Financial sector expanding

Balance sheets of financial corporations continue to grow, reaching €6 trillion in assets in 2019, of which €4.9 trillion were held in the rest of the world. Most of the growth in this sector was in the non-money-market funds sub-sector.

Continued improvement in Government finances

In 2019, the surplus on current Government expenditure amounted to €10.4bn, and after capital investment, Government was a net lender of €1.4bn in the year. This was the second successive year without net borrowing by Government. The debt to GDP ratio decreased to 62%, slightly above the EU 60% imbalance threshold.

Comparing 2007

Comparing 2019 with the 2007 figures, Peter Culhane commented further

'Today's institutional sector accounts provide a detailed picture of the economy in 2019 and its evolution over the last 25 years. Just as in 2007, 2019 was part of a run of years of high growth before economic contraction. However, the shape of Ireland's economy facing into the latest recession is very different to the way it was twelve years previously:

• Household debt to income ratio was 201% in 2007, in 2019 it was 112%
• In 2007 Households were saving 7.8% of their income; in 2019 it was 12.2%
• In 2007 (the tail end of SSIAs), households increased their deposits by almost €7bn and invested over €23bn in new homes and other fixed capital assets. In 2019, households were again saving around €7bn, but were only investing €7bn in new fixed capital assets.
• Measured either by GDP or GNI, the economy in 2019 was more than half as big again as the the economy in 2007 due to the growth of multinationals here
• Government debt to GDP ratio in 2007 was 24%, while in 2019 it was 62%'

The Institutional Sector Accounts will be useful to those interested in a detailed economic analysis of the Irish economy and will set a base for analysis of the very different circumstances impacting the Irish economy in 2020.

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