“Wide geographical spread of high quality investments across Ireland”

“Ireland is now seeking and winning high value investments, that add to our innovation and support regional development; 2006 was a very good year for these investments and we are well set for 2007” said Sean Dorgan, Chief Executive of IDA Ireland, launching the Agency’s end of year review today.

“The quality of investments from global companies into Ireland is of the highest standard, reflecting the remarkable evolution of the business ecosystem in Ireland as international competition and Irish economic conditions have changed,” he added. “Investments in the past year, such as those by Amgen and in R&D by Cisco, GlaxoSmithKline, PepsiCo and Georgia Tech, are clear evidence of this evolution.”

“There has been a rapid transformation in what Ireland offers international investors since the year 2000, which was the last year of volume-based growth; now our growth is quality-based. Then we measured job numbers, now we seek job value. In the past we were concerned to add jobs, because employment numbers mattered. Now, while we still add jobs (gaining a net 3,800 jobs in 2006 in IDA supported companies), it is the impact of creating new areas of opportunity and of raising living standards that drives us. As a result, today’s jobs tend to be more satisfying and better paid.”

Some of the highlights of IDA’s activities during 2006 include:

The IDA says that over recent years, in close cooperation with key national partners, it has set out to reposition Ireland as an advanced knowledge-driven economy, reflecting global changes in business and the significant evolution in Ireland’s capabilities.  This involved creating new areas of strength and positioning Ireland as the destination of choice for knowledge-led activities and sectors. The agency says that the success of this strategy continued in 2006, and Ireland is now in a leadership position in many of the key business segments in which we compete:

In biopharmaceuticals Amgen and Eli Lilly have joined Schering Plough, Wyeth, Genzyme and Centocor in making Ireland the location of choice outside the US for development and manufacture of the newest drugs.

"We are also the place in Europe for digital media, with Amazon in Cork and Dublin, and Google in Dublin growing rapidly, along with other leaders such as eBay / Paypal and Yahoo," IDA Ireland says.

Our leading position in information and communications technologies (ICT) was reinforced by new investments from Cisco, IBM, Netgear, Sandisk and Trend Micro, amongst others.

The financial services sector continues to thrive and saw new investments from Citco (Cork), Northern Trust (in Limerick) and Vesta (Dundalk).

Continued growth in medical technologies was evident from announcements from Cordis (Cashel), USCI (Ballinasloe) and Vistakon (Limerick) among others.

The IDA says that Ireland is now a global competitor for R&D investment from multinational companies and leading research institutions. We are seeing the results of a concerted effort in Government policy to build a substantial foundation of world class science and technology in our academic institutions and, in particular, the encouragement of strong business and academic collaborations. This is enabling the build up of meaningful research and development capabilities of Irish based business, a step that is fundamental to Ireland’s future competitiveness and sustainable growth.

Regional Development

IDA Ireland says that central to its activities is its commitment to achieving the best possible regional balance in investments. In 2006 almost 60% of new Greenfield projects, and 6 out of every 7 R&D investments (or 85%), took place outside Dublin, with a wide geographical spread of high quality investments.

The challenge of a good regional spread of investments increases as the higher value parts of the business value chains are targeted for Ireland. Then the need for a critical mass of suitably qualified talent, supporting infrastructure and sophisticated business services can draw investors towards cities and regions of scale. For most of the investment IDA competes for, the competition is from city regions with a population base of over a million people. In Ireland, only Dublin has a population of this size. For this reason, every location in Ireland has to think and act regionally, rather than locally, if it wishes to succeed, the agency says. The National Spatial Strategy sets out the framework for development in this way and needs to be actively embraced and followed by all economic and social parties.     

IDA says that it has significantly raised the potential for regions to prosper by implementing a national programme of investment in the vital infrastructure of business park development and the provision of sites for major projects. In 2006 major construction work was undertaken in Oranmore, Co Galway and Dundalk, Co Louth on utility-intensive sites. IDA also obtained planning permission for a huge integrated circuit development at Grange Castle, Clondalkin, Co Dublin, which is now being marketed globally.                 

Business Environment

IDA Ireland says that Ireland has reinvented its attractions for inward investment over the past seven years, constantly recognising changes in global conditions and in our own circumstances. It says that now we are distinguished for the quality of our national capabilities, innovation, creativity and connected national ecosystem.

“The performance of IDA over the past seven years generally mirrors the strong national economic performance under the current National Development Plan. As a new NDP is launched in 2007, it is imperative that we continue to invest strongly in infrastructure, and actively encourage knowledge-driven activities. A few aspects are critical:

• investment in transport infrastructure, such as roads, airports and public transport,
• providing competitive and robust energy supplies,
• encouraging our students to study science, engineering and business,
• enabling a fully connected and innovative research environment.

These will be the basis of our future success. If we fail to provide essential infrastructure quickly, Dublin may falter and regions fail,” said Sean Dorgan.

The IDA says that competition for foreign direct investment (FDI) is relentless and global and its nature has markedly changed. Investors have a myriad of location options for each part of their business process. Global corporations can organise their business in physical or virtual form and select the most effective location for each element. In doing so they seek three essential ingredients: the right people and skills, a supportive ecosystem and infrastructure, and a positive and forward looking attitude. These are vital and distinct features of Ireland, which are reflected in the international marketing campaign launched by IDA in May 2006.

Prospects for 2007

“The very strong investment achievements of 2006 combined with the ongoing collaborative national efforts to continue the transformation of Ireland into an ever more advanced knowledge economy, gives us great confidence in our ability to win exciting new investment projects in 2007,” said Sean Dorgan.

“We have a good pipeline of potential investments and we are optimistic of winning quality new investments from new and existing clients for locations across Ireland”.   

SUMMARY OF IDA IRELAND ACTIVITIES 2006

ECONOMIC IMPACT OF IDA SUPPORTED COMPANIES

 

Source:  Based on the Annual Business Survey of Economic Impact, co-ordinated by Forfás and administered by the Survey Unit of the Economic and Social Research Institute (ESRI).

Note 1:  The Survey is based on manufacturing and internationally traded services companies with 10 or more employees (excluding IFSC companies)

Note 2:  Results are based on companies responding to the survey in 2006 (grossed-up to reflect non-respondents).  Results can vary from previous estimates due to revisions made by companies and differences in the base of respondents from one survey period to the next.