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The Dynamics of Ireland's Net External Position

Philip R. Lane
IIIS, Trinity College Dublin and CEPR

IIIS Discussion Paper No. 388

Ireland.s net external liability position expanded in dramatic fashion during 2008-2010, despite relatively small net financial flows during this period. Understanding the the source and persistence of this negative shock is critically important in assessing the future path for the Irish economy. However, data analysis is made difficult by the confounding impact of Ireland.s major role as an international financial centre, such that the "core" international balance sheet remains obscure. However, there is considerable indirect evidence to believe that a substantial component of this decline is genuine and relates to the internationally-leveraged structure of the financial port- folios of domestic Irish residents.







Last updated 28 August 2014 by IIIS (Email).