Introduction
Ambassador Rooney, Ladies and Gentlemen, Good morning. I am delighted to have the opportunity to address you.
It is fitting that we are discussing this theme in Croke Park this morning, one of the most historic playing fields in the world.
This iconic stadium is a symbol of all that is best about our country’s competitive spirit.
The origins of hurling, our national game, can be traced back 3,000 years. The epic battles that are fought here today connect us with our ancient history.
Later this morning you will have the pleasure of hearing from Mícheál Ó Muircheartaigh, one of Ireland’s modern-day legends.
Mícheál will no doubt regale you with some wonderful stories of competition on this pitch.
Our sporting games reveal much about who we are today as a people: creative, hard-working, skilful, optimistic and resilient.
Yesterday, the Olympic Torch came to Dublin.
This Summer, fans from competing county teams will again walk side by side into this ground. They recognise that while winning is important, ultimately it is about taking part and proudly representing their county.
And of course, we know the US shares our passion for sport.
This September, Dublin will play host to one of the most historic rivalries in American Football – the iconic ‘Fighting Irish’ Notre Dame will come ‘home’ to play Navy.
Thousands of fans are due to travel to Ireland for the event, and the worldwide television coverage is expected to reach millions of viewers.
It’s a sporting encounter I’m looking forward to!
Ireland Post-ratification
As you are aware, this day last week the Irish people took another step on the path to economic recovery with their clear and decisive vote in favour of ratifying the European Stability Treaty.
In doing so Ireland has sent a powerful signal around the world that this is a country that is serious about overcoming its economic challenges.
The verdict of the people in the referendum will help to create the stability and certainty that investors in Ireland need.
It will enable the strong flow of inward investment by multi-national companies to create new jobs in Ireland to continue.
While this Treaty will not solve all Ireland's problems, it is one of the many foundation stones we need to put in place to ensure our economy stands on firm ground for the future.
However, I have consistently argued that budget rules alone will not be enough to overcome the economic crisis in Europe.
They must go hand in hand with a real and concrete growth programme for Europe.
The developing situation in Europe's banking sector needs a comprehensive solution, and Ireland's banking debt must form part of that solution.
Europe badly needs a success story as it seeks to recover; we have shown that Ireland can provide that success story if the right framework is put in place.
Macro-economic and Fiscal situation
Last year when my Government came into office I made it one of our top priorities to restore the good name of Ireland as a place of business and of investment.
Already, the progress that Ireland has made in repairing our damaged economy is well recognised internationally.
Step by step, we are bringing our public finances under control through our fiscal consolidation programme.
Our underlying deficit fell rapidly last year to 9.4% of GDP, well below our 10.6% target.
The EU Commission forecasts that Ireland’s deficit will come in well below 8.6% of GDP target for this year.
At the same time, my Government has brought a strong and determined focus to the agenda for growth and jobs.
We are expecting a second successive year of economic growth,
driven by exports. The EU Commission expects Irish growth to accelerate to 2% next year, despite weak European performance;
Our current account of balance of payments is now positive – Ireland is paying down its debts. This is an important indicator of sustainability; and
Our exports are booming. 2011 was a record year for exports by indigenous companies.
Employment grew by 10,000 in the last quarter in 2011 on a seasonally adjusted basis, the first quarterly growth since 2007.
The bond markets are clearly taking note of Ireland’s performance. Yields on 9-year sovereign bonds have more than halved since last July.
We will continue to meet all of our commitments under the recovery programme, and work to position Ireland for a return to the bond markets next year.
Job Creation
While this progress is encouraging, we have much more to do.
Of course, Governments don’t primarily create jobs.
But we in Ireland understand better than most how critical it is to create an environment where the levers of democracy work effectively – to open the doors for business opportunities that work clearly in the people’s interest and in the nation’s interest.
This is something that my Government, and the enterprise development agencies such as IDA Ireland and Enterprise Ireland, are very focussed on.
Through our Action Plan for Jobs published earlier this year, we are implementing a huge range of specific measures to reduce costs to business, improve access to finance and encourage greater innovation.
Ireland’s Competitiveness
Restoring Ireland’s competitiveness is a key element of this Action Plan.
We are already seeing very significant improvements in this regard.
The IMD World Competitiveness rankings published last week show that Ireland is now back in the world’s top 20 for competitiveness.
- We are number 1 in the world for the availability of skilled labour;
- We are 2nd in the world for productivity and efficiency;
- We are rated no 1 for our flexibility and adaptability when faced with new challenges; and
- We top the rankings on globalisation and reform.
This is borne out by the 2012 Ernst and Young Globalisation Index, which rates Ireland as the most globalised nation in the western world.
Of course cost competitiveness is very important and our performance here was a significant issue in the early 2000’s.
However, again this is an area where we are making significant progress.
And our performance will continue to improve.
Following declines in 2009, 2010 and 2011 the European Commission anticipates that Irish unit labour costs will fall by a cumulative 16.5% over the period 2009 to 2013.
In contrast, unit labour costs in the euro area as a whole, are forecast to increase by close to 6.7% over the same period.
These projections show that Ireland’s relative position will have improved by around 22% vis-à-vis the euro area since 2009, a very rapid turnaround.
Similarly Irish inflation was considerably higher than that in the euro area in the early years of monetary union, resulting in a deterioration of our price competitiveness.
In 2009 and 2010, however, Irish price levels declined while those in the euro area continued to increase.
Irish inflation rates are forecast to remain below those in the euro area for the period 2012 to 2013 as a whole, further improving our relative competitiveness.
However, as today’s conference recognises competitiveness is not just about cost or the bottom line.
History shows that diversity and inclusion can play a significant part in driving economic and social benefits.
Diversity
I am pleased to say that this is an area where Ireland has significantly changed in recent years.
This country has transformed in so many ways over the last decade.
Successive expansions of the EU have opened up the Irish labour market and indeed the country.
Ireland in 2012 is a different, and better, society because of the increasing diversity in our population. This benefits us in cultural and societal terms. But it also benefits us economically.
In the last decade, the participation rate of women in the Irish labour market has significantly increased. So too has the ethnic diversity in the Irish labour market.
According to our 2011 Census, the number of Irish residents who were born outside Ireland continues to increase, and stood at 766,770 in 2011.
This is an increase of 25 per cent on 2006, and means that 17 per cent of the population are born outside of Ireland.
We have benefitted from exposure to very positive influences from other nations and cultures.
We have become a more open and diverse society.
And we have shown a strong track record in welcoming new
arrivals and integrating them into our communities.
But of course we can and must do more.
A recent survey has shown that the recession has disproportionately impacted on our immigrant community.
We need to ensure that we work to mitigate the effects of the recession on vulnerable groups.
As Maya Angelou said “diversity makes for a rich tapestry”
It is vital that we ensure that the current economic climate does not result in us losing the gains we have made in recent years in terms of openness and multiculturalism.
Foreign Direct Investment
Of course, Foreign Direct Investment is and will continue to be very important for Ireland.
Our 12½% corporation tax rate remains – and will continue to remain – at the heart of our strategy to attract foreign direct investment.
However, our talent and track record are equally important. Ireland remains one of the best places in the world to do business.
International surveys consistently place us in the top half dozen locations for investment.
In 2011, IDA-supported companies contributed over €115bn worth of exports to the economy. Clearly, multinational companies will continue to play a huge role in influencing Ireland’s growth prospects.
Just in the past few weeks, we have seen a number of large multi-national companies vote confidence in Ireland.
Significant investment announcements by companies such as Apple, Paypal, Cisco, Amgen, Mylan, HP, Eli-Lily, and SAP underscore Ireland’s continuing attractiveness as a location for top firms to base themselves in.
As well as continuing this success in attracting FDI, we are taking a range of measures aimed at developing and deepening its impact.
We have made a number of changes in the Finance Act 2012 to make it attractive for senior executives to locate in Ireland including in particular the Special Assignee Relief Programme.
We have also set up a Register of Advocates from the Global Irish Network, who have volunteered to assist in a number of areas.
Enterprise Ireland and the IDA are also working together to maximise the benefits and learning for Irish SME’s from FDI.
This kind of collaboration is key.
One of the real benefits from our recent economic difficulties has been that our people and organisations are working together like never before to ensure our recovery.
And I have been truly overwhelmed by the levels of assistance and support we have received from the friends of Ireland both here and abroad.
Concluding Remarks
In conclusion, I would like to take this opportunity to express my gratitude to Ambassador Rooney as a great supporter and contributor to Ireland in these difficult times.
The theme of the conference reflects his interests and achievements.
I am sure that given the theme and the very interesting speakers you will have a thought provoking and challenging day.
Thank you.