Foreign direct investment (FDI) into Ireland has been strong in the first half of the year, IDA Ireland and the Minister for Jobs, Enterprise and Innovation Richard Bruton TD reported today, with notable gains in the technology, life sciences and international financial services sectors.
IDA, the government agency responsible for attracting inward investment, together with Minister Bruton and his Department have helped secure 70 individual projects to date in 2013, compared to 61 at this stage last year. Of the 70 projects, 35 have come from companies deciding to invest in Ireland for the first time.
It is expected the 70 projects supported by the Department of Jobs, Enterprise and Innovation through IDA Ireland in the first half of this year will lead to the creation of 7,000 roles this year and over future years as the companies implement their investments.
(Annual gross and net employment levels at IDA client companies are measured via the Forfas Annual Employment Survey, released in January of each year by IDA).
IDA’s 2012 Annual Report*, also released today, shows total employment of 152,785 people working in 1,033 IDA client companies. 2012 saw the creation of over 12,722 new jobs. Job losses at IDA client companies were the lowest for a decade.
Among the companies who announced job creation plans in the first half of 2013, or plans to place fresh investment into Ireland, were:
Ebay, EMC, McAfee, Pfizer, Sanofi, Symantec, Zurich, Huawei, Yahoo, Facebook, Vistakon, Guidewire, Squarespace, Groupon, Qualcomm, Novartis, Nypro, AOL and FireEye.
Minister for Jobs, Enterprise and Innovation Richard Bruton TD said:
“A key part of the Government’s plans for jobs and growth is targeting increased employment creation from the FDI sector, and in 2012 we have seen record growth with more than 12,000 jobs created by multinational companies. Today’s results show that this strong trend is continuing in the first half of 2013, with an increased number of investments which will create 7,000 jobs.
“I wish to commend Barry O’Leary and all his team at IDA, as well as officials in my Department, on this excellent achievement. I am determined to ensure that, with implementation of policy changes through the Action Plan for Jobs, continued financial support for IDA through my Department, and a strong programme of international investment missions, we can continue this strong trend of employment and get people back to work”.
Mr Barry O’Leary, Chief Executive of IDA said: “2012 was a very strong year for FDI in Ireland and progress has continued into the first six months of the year. The increase in the number of first time investors coming to Ireland is a very clear trend.”
Despite a poor economic background in Europe, the key market for IDA clients, and strong competition from locations such as the Netherlands and the UK, the first six months have started well for Ireland, as many companies consolidate their operations into pan-European centres.
The strong performance over the last 12 months has provided a lift to the property/construction industries, with some 5,000 construction workers working on building projects of IDA client companies.
In addition, IDA client companies are currently in negotiations to take up 600,000 square feet of property stock over coming months.
“FDI successes have strong knock on effects economically, and this includes in leisure, retail and most significantly property. As a result the number of properties in prime locations available for future FDI expansions is starting to reduce, creating a challenge in future years,” said Mr O’Leary.
“IDA is working with NAMA and other stakeholders to address this challenge. NAMA is in the strongest leadership position to address these challenges,” Mr O’Leary added.
In relation to corporation tax, Mr O’Leary said a number of jurisdictions were attempting to enhance their taxation offering, including the UK, the Netherlands and Switzerland and this posed challenges for Ireland.
“Ireland’s tax rate of 12.5% is a highly attractive part of the overall FDI offering, but the taxation landscape is constantly evolving, something Ireland always needs to be aware of.
Ireland operates in an international environment and is playing a full part in the OECD’s Base Erosion and Profit Shifting (BEPS) process. Ireland will seek to move forward multilaterally with other countries on reforms which may emerge from this process,” he said.
The IDA annual report and accounts (link) includes a sectoral breakdown of total employment from IDA client companies. This shows an increase in employment in almost all IDA’s targeted sectors and stability in pharma employment, despite challenges for this sector.
“The pharma industry globally is dealing with two key challenges at present – over capacity and patent expiry – and Ireland is no exception to these trends. However Ireland has won nine new investments in pharma/bio-pharma in the last year and a half, and IDA is currently pursuing several key strategic investments on behalf of Ireland in this sector,” Mr O’Leary pointed out.
IDA said it was cautiously optimistic about the remainder of the year.
“There is a clear slowdown in Europe, a key market for IDA clients and this poses a particular challenge. Nevertheless there are opportunities in sectors like technology, international financial services, life sciences and where consolidation is taking place on a pan-European basis. IDA is also confident of taking advantage of new high growth sectors like big data in the period ahead,” said Mr O’Leary.
“Across a diverse range of sectors, several key projects are in play and Ireland is in a strong position to secure a number of these in the second half of the year,” he added.