Introduction
Chair, ladies and gentlemen,
I’m very pleased to be here today to address this year’s IFIA Annual Conference.
I know that when Minister Noonan opened the conference last year he spoke in some detail about the issues concerning and affecting your sector.
Of course this time last year we were coming to the conclusion of our successful EU Presidency where I am pleased to say the Government and the Presidency team achieved real progress on some key financial issues.
No doubt when Minister Noonan spoke last year he will also have updated you on our growing economic recovery, and about our plans to exit the programme of support and return to the financial markets.
Irish economy
Ireland is a country with a plan.
In the past year we have seen much progress as a country.
We were the first country inside the Euro area to successfully emerge from an EU/IMF bailout;
We have cemented our return to the international bond markets; and
We have seen strong annual job growth of 2.3%, and a sharp reduction in unemployment.
Exiting our bailout last December without the need for a precautionary backstop was an important milestone, and a significant vote of international confidence in Ireland.
And just as we had a plan to exit the bail-out, we now have a clear plan to support our economic recovery - a plan based on enterprise.
Our Medium Term Economic Strategy sets out our plan to stabilise the public finances, restructure the banking sector, grow the economy and, most importantly, return the country to full employment by 2020.
We have also exceeded our budgetary targets, and will reduce the Government deficit to below 3% of GDP by 2015 and eliminate it altogether by 2018.
The restoration of Ireland’s investment grade status across the major credit rating agencies reflects the significant progress we have made.
Earlier this month Standard and Poor’s became the first major rating agency to restore an A rating to Irish sovereign debt. Following the upgrade yields on Irish borrowing costs fell to record lows.
Already this year we have raised more than 80 per cent of our 2014 funding target on the bond markets at competitive rates.
In the meantime we are completing the necessary restructuring of the Irish banking sector in a manner that underpins a return to sustainable profitability and private ownership.
At the same time we are working to increase the availability of non-bank funding. A new Strategic Investment Fund is already open for business and is exploring and making investments that meet its dual mandate of investment return and economic impact.
We are also establishing a Strategic Banking Corporation to work with European development banks to support the availability of finance to business.
We are anticipating economic growth in GDP of 2.1% this year, supported by robust domestic demand including strong growth in investment in the economy.
The strong performance of the jobs market is consistent with the stabilisation of domestic demand that emerged over the course of last year.
As a Government we are committed to taking the necessary decisions to ensure that our journey of economic recovery continues, that employment continues to grow and unemployment continues to reduce.
Funds Industry and IFS
And I understand the Irish Funds Sector has its own ambitious growth targets.
The Funds industry is making a significant contribution to these goals employing over 13,000 people across Ireland, many of whom are some of our best and brightest talent.
The industry is one of the star performers of the Irish economy having developed significantly since the establishment of the IFSC in 1987, through the development, promotion, sale, marketing and administration of Investment Funds sold internationally.
I understand that the value of investment funds domiciled or administered in Ireland is approximately €2.7 trillion. This is an outstanding achievement for a small country and testament to Ireland’s business friendly environment.
We in Government look to the Industry to continue to grow as impressively as it has over recent years; to invest; to generate new jobs and wealth; to continue to play a leading part in our recovery.
For its part, the Government, through measures including those in the Action Plan for Jobs will continue to support the growth and development of the industry.
As many of you will be aware, the IFSC Clearing House Group was reformed late last year with a new structure, membership, and a strategic group.
These changes were made to ensure that the Group is fit for purpose in terms of maximising the contribution of the sector to the national collective objectives of job creation, reducing unemployment and economic recovery.
This year’s Action Plan for Jobs includes a number of actions to promote and develop the international financial services.
We are ambitious for your sector and I want to thank those of you here today who are actively contributing to this work and encourage all to contribute where you can.
This Government is always open for feedback as to how we might do better in supporting jobs and growth.
ICAV
Ireland has positioned itself as a world-class domicile for funds and we need to keep pace with developments in other funds domicile to ensure that we keep our competitive edge.
Legislation to provide for an Irish open-ended investment vehicle, the ICAV, is a high priority for the Government and I expect the legislation will be published in the coming weeks. The Department of Finance is working very closely with stakeholders to ensure that this happens as soon as possible.
Regulation
Turning to regulation, I know that the evolution of global and EU regulation greatly impacts on your industry.
As I have said before, the failures of the financial crisis have quite correctly placed an increased spotlight on the need for appropriate and balanced global regulation of the sector.
Our economy, our international reputation and above all the Irish people suffered devastating consequences due to the regulatory and governance failures of the past.
We now recognise that there is no alternative to watchfulness and vigilance in financial regulation. We need to demonstrate that we have learned from previous mistakes and that the governance, regulatory and enforcement failures of the past will never happen again.
We need a regulatory environment that is seen as robust, certain and reliable and that ensures the highest standards for the industry.
Our goal is for Ireland to continue to be a leader in the international financial services sector underpinned by a leading regulatory model. We believe that this can be achieved without creating an unnecessary regulatory burden on firms which play by the rules.
And we have made significant progress in terms of reforming and rebuilding regulatory structures, institutions and architecture to ensure a regulatory system that is effective, robust and fit for purpose.
Innovation and Development
Rebuilding Ireland’s international reputation has been key to attracting more inward investment and jobs. Ireland is often described as the gateway to Europe.
Indeed, I recently visited a number of digital media companies on the US West Coast, many of whom have their European Headquarters in Ireland.
As a committed and active participant in all aspects of the European Union, international investment firms seeking a bridge to Europe should also continue to look to Ireland as they have in the past for access to the Union’s 28 markets.
I’m delighted to note that the services being offered here are also instrumental in further expanding access to important growth markets.
The Government, through its Jobs plan has identified a number of priority and high growth markets, which of course includes China.
My 2012 visit to China and the visit here of Xi Jinping earlier that year marked a strengthening of Ireland's relationship with China.
Yesterday I had the opportunity to welcome to Dublin and discuss areas of mutual opportunity with Mr. Liu Yunshan, a member of the CPC Politburo Standing Committee and of the Central Secretariat of the CPC.
The establishment earlier this year of a joint NPRF-China Investment Corporation (CIC) $100 million China Ireland Technology Growth Capital Fund exemplifies this opportunity and should contribute to increased economic activity, trade and investment between Ireland and China.
I understand the enormous potential that China presents for the Irish funds industry. As well as having dedicated IDA resources with financial services expertise located in Beijing, the Irish Government is
establishing a full consulate in Hong Kong later this year which will further support the work that the IFIA have been carrying out there in recent years.
I would encourage you to continue your efforts in these high potential markets for Ireland.
Conclusion
Once again, I would like to thank you for the invitation to speak here today.
I know many of the firms represented in the room have been doing business here for over 20 years and I want to take this opportunity to thank you for your commitment to Ireland.
To any prospective clients in the audience, there has never been a better time to do business in Ireland.
I look forward to your support as we continue to develop Ireland’s international financial services sector as an engine for jobs and growth across the enter spectrum of businesses, not just in the IFSC, but in Ireland as a whole.
Thank you.
ENDS