Taoiseach Enda Kenny today addressed the FIBI International Banking Conference. In his address, the Taoiseach spoke of the importance of international banking and the financial services sector to the Irish economy:
The international banking industry brings to Ireland high value jobs. IFSC companies employ more than 25,000 people in Ireland. Some 40% of this employment is accounted for by banks alone. I was delighted to learn that overall employment increased in the IFSC in 2010 for the first time in three years.
You contribute to the cost of public services. In 2010 IFSC companies accounted for 16% of overall corporate tax receipts.
You integrate Ireland and Irish companies into the global economy through trade and investment flows. Ireland is now the fifth-largest exporter of financial services in the world, with exports still growing strongly in these difficult times. The IFSC accounts for 27% of services exports from Ireland. This makes the IFSC a key contributor to Ireland’s balance of trade with a trade surplus of over €7 billion in the twelve months ending September 2011.
The Taoiseach also spoke of progress made in restructuring Ireland's banking system:
We have recapitalised, downsized and stabilised the domestic banking system – at half the original estimated cost to the Irish taxpayer. We welcomed new private investment into Bank of Ireland, and remain committed to returning the other banks to private ownership.
And for the last five months running, we have witnessed a net inflow of deposits back into the Irish banking system, resulting in a greater than expected fall in our banking system’s reliance on central bank financing over the course of the last year.
While the impact of these measures on the real economy and at the local level will take time, the evidence on the ground is that Ireland is now facing in the right direction.
The improved international confidence in Ireland’s economy is reflected in the strong lines of inward foreign investment, as evidenced by the recent announcements by PayPal, Microsoft and others.
IDA Ireland reported its best results last year for over a decade and a strong pipeline of new projects for the year ahead.
The economy returned to growth in 2011 for the first time in four years, with exports of goods and services reaching new highs.
The Taoiseach said banks would play a part in Ireland's economic recovery:
I want banks – both domestic and international – to also play a key role in our economic recovery. As I have said on a number of occasions to our domestic players, I want banks to become part of the solution to our economic challenges rather than part of the problem.
That is why in July 2011, I had the pleasure of launching the Strategy for the International Financial Services Industry in Ireland 2011-2016, setting a target of growing employment in the sector by 10,000 over 5 years....
The target is ambitious and challenging. But less than 12 years ago, the IFSC employed only 8,500 people; it now employs 33,000. We are building from a position of far greater strength than we were then.
The Taoiseach highlighted the areas of Islamic Finance and green economy:
Ireland has been active in concluding double taxation agreements with important Islamic States, including recently Saudi Arabia, Bahrain, Kuwait and the UAE. We are determined to ensure that the IFSC is a Centre of Excellence for Islamic Finance and the changes in recent Finance Acts will support its development. The Central Bank of Ireland has already authorised a number of Sharia compliant funds.
Another area where we see significant potential for growth for the Irish financial sector is the green economy.
On Monday last in New York the Green IFSC’s Global Green Asset Management Network was launched thereby taking a further step forward towards achieving that goal.Irish green asset management and green enterprise firms are active all over the globe from China to Chile and Ireland to Africa and, with $10 billion in green assets managed or serviced, Ireland is already emerging as a world leader in green finance. The establishment of this network can only serve to accelerate the continued growth and copper-fasten Ireland’s growing reputation in this sector.
The Taoiseach concluded:
It is vital that the next generation of innovations from the financial sector are seen as having played a key role in recovery, jobs and the creation of new industries, and that financial institutions in Ireland are at the centre of these developments.Read the full speech here.
I’ll finish by saying that there is no better time to invest in Ireland and to be part of our recovery story. This is what I was told US investors this week and what I’ll tell Chinese investors next week.
Ireland is open for business.