Imports and exports of products used in the infrastructure that supports artificial intelligence (AI) will have a noticeable, positive impact on Irish trade and investment this year, Ibec has said. However, the outlook for Ireland’s economy remains “volatile” amid uncertainty around the trajectory of global energy prices and domestic inflation.In its latest quarterly economic outlook, the employer’s group said Irish exports overall are experiencing a “whiplash” effect in 2026. Companies, particularly in the pharmaceutical sector, front-loaded exports to the US last year in a bid to circumvent the new US tariff regime. Consequently, global trade growth is expected to decline significantly, according to the World Trade Organisation (WTO).“This ‘whiplash’ effect can be seen in more extreme terms in Ireland, driven in particular by a small number of very high value pharmaceutical products manufactured here,” Ibec said.“Total exports from Ireland to the US grew from €22 billion in January to April 2024, to €60 billion in 2025 and slowed to €17 billion in 2026.”One area of trade that is performing well this year is AI-enabling products, including trade in semiconductors and data processing machines, according to the report. Again citing WTO figures, Ibec said the Republic is now the ninth-largest importer and exporter of AI equipment in the world. “What is more remarkable is the growth of both exports and imports over the past five years,” it added. “Imports of AI-enabling equipment and materials respectively have risen from €10.7 billion in the 12 months to April 2021 to €29.4 billion in the 12 months to April 2026. “Exports have risen concurrently over the same period from €14.3 billion to €26.7 billion.”While it “appears” that a large proportion of the products imported into Ireland are being sent to other markets such as the UK, Ibec said these “rising flows” of AI-related trade are evident in investment figures.Almost €6 billion has been invested in information and communication technology (ICT) equipment over the past year, the lobby group said.“We are seeing early evidence of the impact of AI on our economic figures,” said Gerard Brady, Ibec’s chief economist. “Domestic investment in ICT equipment and software has risen to nearly €6 billion over the past 12 months – a 50 per cent increase on the same period last year and a doubling from two years ago. Recent investment decisions will support this trend further.”The ESRI said last month that it is now forecasting investment levels in ICT equipment to remain higher than historical norms in the short to medium term. Conor O’Toole, a research professor at the think-tank, said at the time that the materials involved, particularly chips, have a short shelf-life.At the headline level, Ibec said the outlook for the Irish economy remains volatile. The employers lobby group is forecasting consumer price inflation of 3.6 per cent this year, up from 2.2 per cent last year, which will “eat up most of the real income growth in the economy”. However, it said inflation could rise closer to 6 per cent if hostilities in the Gulf escalate and the Strait of Hormuz remains closed to traffic. “The collapse of the US-Iran ceasefire less than three weeks after implementation began underlines the uncertainty running through the global economy this year,” said Brady.