3rd October 2013
The economic relationship between Ireland and the US has strengthened considerably over the past five years despite the global recession according to a new report commissioned by the American Chamber of Commerce Ireland.
US Investment in Ireland Surges Ahead in past 5 years
Thursday, 3 October 2013
The economic relationship between Ireland and the US has strengthened considerably over the past five years despite the global recession according to a new report commissioned by the American Chamber of Commerce Ireland. The report reveals that US firms invested more capital in Ireland over the five-year period starting in 2008 and ending in 2012, than in the previous 58 years combined. Perhaps of even greater significance, that level of investment was roughly 14 times larger than US investment in China over the same period.
The report, entitled “The Irish US Economic Relationship 2013”, was compiled on behalf of the American Chamber of Commerce Ireland by leading Wall Street economist and strategist, Joseph P Quinlan. Mr. Quinlan regularly advises policy makers and legislators on Capitol Hill on global trade and economic issues. He has also testified before the European Parliament and has served as a consultant to the US Department of State.
“Ireland has become hugely important for the success of corporate America over the past five years”, said Peter Keegan, President of the American Chamber of Commerce Ireland. “There has been $129.5 billion investment in Ireland by US firms over the past five years and the stock of US investment in Ireland is now more than $200 billion for the first time. Corporate America’s FDI stock in Ireland is now equal to the combined stock in France and Germany and it’s nearly 20% larger than the aggregate US stock in the four BRIC nations of Brazil, Russia, India and China”.
Launching the report, Richard Bruton, TD, the Minister for Jobs, Enterprise & Innovation referred to the growing importance of US investment to the Irish economy.
“Deepening and developing our economic ties with the United States will be crucial for our economic recovery and forms a major part of the Government’s plans for jobs and growth. The excellent report published today by the American Chamber shows that our performance continues to improve, with continued increase in US investment here in the past year. Challenges remain for Irish companies doing business in the US, but it is important to recognise that such companies employ well over 100,000 people there. Measures to assist businesses on both sides of the equation – US companies seeking to invest in Ireland, and Irish companies seeking to expand their operations abroad – are being implemented as part of the Action Plan for Jobs, and I am determined to ensure that we can build on these achievements to create the jobs we need.”
Speaking about the report’s findings in relation to Ireland’s importance to US firms Mr Joesph Quinlan said: “Ireland now ranks the number one export platform in the world for US affiliates. This underscores the importance of Ireland in the global value chains of US firms. Corporate America’s presence in Ireland is also tangible, visible, palpable, material, physical and concrete making Ireland a hugely important strategic cog in the global operations of many of the world’s top corporations.”
“This report is both revealing and encouraging. It reveals that US firms are now deeply embedded in the Irish economy, and account for over one quarter of the nation’s gross domestic product with annual output reaching $62.5 billion in 2010. It is also encouraging in terms of the continued growth in the level of investment by US firms here. Ireland ranked as the fourth largest recipient of US FDI in 2012 when we garnered almost as much as all of developing Asia combined. Furthermore, while US investment to Ireland actually rose by 1% to $22.8 billion last year investment to the EU declined sharply by some 17.5% in the same year”.
The report also reveals the two-way nature of the relationship. Irish firms now have a sizeable presence in the United States which is valued at roughly $25 billion in 2012 on a historic cost basis. This is a larger position in the US than Italy’s, South Korea’s and five times that of China.
“This report is welcome confirmation of the enduring strength of the economic relationship between Ireland and the United States”, Mr Keegan added. “The fact that US investment in Ireland is actually increasing while it is falling quite dramatically in the rest of the EU is proof that we continue to have a compelling offer for US firms looking to expand their global presence. However, a key element of that offer is our ability to provide the talented workforce required by these firms. Twitter, Qualtrics and TripAdvisor have all announced investments in Ireland in the past two weeks and all have spoken about the importance of Ireland’s talent pool in their decision to invest here.
“Our ability to continue to provide a vibrant talent pool is crucially dependent not only on continuing investment in the education and training of our young people but also on our ability to retain the talent here in this country and to attract the talented people in from overseas when required. In many cases this will mean providing opportunities for Irish graduates to return home to work here. However, we have to accept that the current levels of personal taxation in this country make the task of retaining and attracting talent that bit more difficult. In these circumstances, if I was to ask one thing of Government colleagues in advance of the forthcoming Budget it is to think very hard about personal tax levels and their implications for our future competitiveness as an FDI location.”
Today’s launch event was sponsored by KPMG.
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For further information: Laurie Mannix, MKC Communications 01 7038620.
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