Ireland’s economic momentum has accelerated significantly this year, propelled largely by the extraordinary performance of the multinational sector. A combination of booming pharmaceutical activity, strong technology exports and robust domestic conditions has resulted in one of the strongest periods of growth the country has experienced in recent years.
Pharmaceutical exports have been a standout factor. According to the Irish Fiscal Advisory Council, almost all of the €40 billion increase in exports to the United States in the first five months of 2025 stemmed from the active ingredient used in Eli Lilly’s high-demand weight-loss drugs, produced at the firm’s Kinsale facility in Co Cork. With eight of the world’s top ten pharmaceutical companies operating in Ireland, the country now ranks as the third largest pharmaceutical exporter globally.
While many analysts initially assumed that the surge early in the year reflected companies front-loading exports ahead of expected US tariffs, export volumes have remained high. Key industry agreements have played a role. Pfizer recently struck a deal with the White House to supply certain medicines at heavily discounted prices via a new online platform. In return, the company secured a three-year exemption from tariffs. AstraZeneca has agreed similar terms, and other firms are expected to follow.
The technology sector is also performing strongly. Output from the part of the economy dominated by foreign multinationals expanded by more than 31 percent in the first nine months of 2025 compared with the same period last year. This growth has pushed overall GDP up by 15.8 percent over the same timeframe.
Corporation tax receipts reflect this exceptional performance. November alone generated €10 billion in corporation tax, exceeding the entire annual total recorded only a decade ago. Economists expect receipts to continue rising next year because tax payments typically reflect profits made in the previous year.
Despite these extraordinary inflows, concerns have been raised about how the State is using this revenue. The Irish Fiscal Advisory Council notes that the share of corporation tax being saved is falling sharply. Only 15 percent is set to be retained next year, down from more than 30 percent this year. The Council argues that Ireland should take advantage of the current windfall to prepare for long-term challenges, including demographic pressures and climate commitments.
Although the multinational boom does not translate evenly across all sectors, the domestic economy continues to show resilience. CSO figures reveal domestic growth of 4.1 percent in the first nine months of 2025, alongside a 2.9 percent rise in consumer spending. Income tax and VAT receipts are exceeding expectations, signalling continued employment strength and steady household demand.
Ireland’s economic performance remains exceptionally strong by international standards. The central question now is whether the Government will channel this period of prosperity into long-term national improvements or whether the opportunity will be lost.
Disclaimer: This article is based on publicly available information and is intended for general guidance only. While every effort has been made to ensure accuracy at the time of publication, details may change and errors may occur. This content does not constitute financial, legal or professional advice. Readers should seek appropriate professional guidance before making decisions. Neither the publisher nor the authors accept liability for any loss arising from reliance on this material.
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