6th July 2016
IDA currently on track to equal last year’s record performance
Ireland Proposition Strong Amidst Uncertainty after Brexit Referendum
IDA Ireland, the inward investment agency of the Irish Government, has today reported a strong first half of 2016 as Ireland continues to be one of the strongest performers in Europe in the foreign direct investment (FDI) sector.
Investments approved by IDA in the first half will lead to the creation of 9,100 jobs as companies roll out their plans over the coming months and years. This performance is on a par with H1 2015 which was one of Ireland’s best years for FDI. Ireland won 115 projects in the first six months of the year, the IDA said, compared to 110 in the same period last year.
Technology & Business Services and International Financial Services were amongst the strongest performers in the first half of the year. This was followed by Life Sciences. While the US remains Ireland’s key source market, Growth Markets including Asia-Pacific are showing increased growth over a smaller base. IDA also pointed to the changing structure of the Pharmaceutical sector. Ireland is winning a significant amount of capital intensive bio-pharma investment to support the commercialisation of a range of new drugs. However in parallel, some older plants are facing challenges to their competitive position due to their older product and technology mix.
The organisation, which works with over 1,200 overseas companies, said it expected the recent UK referendum decision to leave the European Union (so-called Brexit) may present potential opportunities in the period ahead generated by newly mobile foreign direct investment, but it warned that the impact of Brexit on the global and the European economy was as yet unknown and it could have a dampening effect on FDI globally which was already expected to decline this year. (*See notes to editor for more detail on IDA's Brexit response)
Martin Shanahan, IDA Chief Executive Officer said that he believed that “Ireland’s stability, the certainty on EU membership and therefore access to the European market, coupled with the strong value proposition that Ireland already offers would be important in the period ahead. This value proposition also includes access to talent (both Irish and European), a competitive, transparent and consistent taxation regime and the ease of doing business,” he said.
Shanahan added: “Similarities between Ireland and the UK and attributes such as being English speaking, a common law system and geographic proximity means that Ireland will be the first choice for many companies that require a base within the European Union.” IDA plans to work directly with companies in the period ahead on their international activities.
Minister for Jobs, Enterprise and Innovation, Mary Mitchell O’Connor TD said: "It is very positive that the IDA is building on last year's record results by maintaining its strong performance in 2016. Foreign direct investment (FDI) remains key to sustaining economic growth and job creation here and these mid-year results help demonstrate that Ireland remains very attractive to overseas companies. The Government will continue to work with the IDA throughout 2016 to win new investment into Ireland and I am especially determined that the benefits of further FDI will be spread more evenly across the country."
The Minister added: "The decision by the people of the United Kingdom to leave the European Union may create challenges for the global FDI environment. But Ireland's strengths - including our talented workforce, ease of doing business and our strong track record for FDI - very much remain in place and I am confident that the IDA is also equipped to harness any new opportunities that may arise."
IDA Ireland said it is impossible to quantify the scale of Brexit opportunities at this stage and engagements with clients and prospective investors are ongoing. IDA has written to all its clients to reassure them of Ireland's position as a member of the European Union and to offer IDA’s support in dealing with issues that may arise from changes at a European level.
Commenting on the first half trends, Martin Shanahan, Chief Executive Officer said: “The flow of investments won by Ireland in the first half of the year have been very strong considering the global economic and geo-political backdrop, and we are cautiously optimistic that the second half of the year will see a continuation of this trend. Ireland continues to outperform and grow market share, however with the full impact of Brexit still unknown and economic conditions changing in some key markets, the final 2016 outcome is subject to some risk at this stage and a lack of visibility.”
Shanahan also added that he “expected competition for investment to remain intense and that Ireland needed to continue to focus on competitiveness, maintain pro-enterprise policies and to invest in infrastructure and enterprise supports.”
A strong feature of the first six months was the amount of investments won for locations outside Dublin. Investments into regional location in the first half of 2016 included:
Nenagh, Co. Tipperary
Dungarvan, Co. Waterford
Ballinasloe, Co. Galway
Shanahan said that “IDA Ireland remained committed to increasing investments into regional locations.”
The organisation also published its annual report for 2015, showing that total employment is now at 187,056.
Annual Report here: www.idaireland.com/docs/annual-reports/2015/annual_report_2015.pdf
For further information, contact:
Kevin Sammon - IDA Ireland - +353876188564
Notes to Editor
IDA had been discussing Brexit with clients and potential investors before the referendum vote.
It has put in place a comprehensive plan to address the impact of Brexit. The plan seeks to maximise the opportunity for Ireland from any newly mobile investment across the globe, but it also seeks to mitigate any risk which may emanate as a result of Brexit.
IDA Ireland has already taken the following steps since the outcome of the referendum became known.
On Friday last (24th June) IDA Ireland CEO Martin Shanahan wrote to over 1200 existing IDA clients. The purpose of the letter was to:
- Reassure clients of Ireland’s continued membership of the EU and provide certainty in relation to Ireland’s continued access to the European market.
- Remind clients’ of Ireland’s positive attributes incl. talent & skills availability, a competitive, consistent and transparent tax regime, the ease of doing business here and the fact that Ireland is English speaking etc.
- Offer IDA Ireland’s support to them as they grapple with the implications of Brexit.
IDA Account Managers are now following up with senior executives of client companies here and abroad.
IDA has engaged with national and international media throughout the past week and a half with the aim of communicating the above key messages. IDA Ireland is currently planning an advertising campaign in the US and Europe in coming weeks that will remind companies of the many reasons there are to invest in Ireland.
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