Introduction
Good morning ladies and gentlemen I am delighted to have the opportunity to address you this morning.
I would like to congratulate Bloomberg on putting together a really interesting Programme covering a wide range of economic issues relevant to Ireland.
Today’s conference is timely.
Important questions and issues are currently being debated, here at home and internationally, about Ireland’s pathway towards recovery and in particular of course in the context of developments in the Eurozone.
Progress on economy
Right across Europe, there are ongoing debates about what strategies are appropriate to deal with the economic and social challenges facing many economies across the EU and beyond.
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.
In this regard the progress already made by Ireland in repairing our damaged economy is well-recognised internationally.
Due to the determination and fortitude of the Irish people we have made significant progress in returning our economy to growth, in reforming our banking system and in repairing our international reputation.
Step by step, we are bringing our public finances under control through our fiscal consolidation programme.
At the same time, my Government has brought a strong and determined focus to the agenda for growth and jobs.
As a result Ireland’s recent performance has separated us from other European economies.
For example:
- We’re expecting a second 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;
- Employment actually grew by 10,000 in during the last quarter in 2011 on a seasonally adjusted basis, the first quarterly growth since 2007;
- Our underlying deficit fell rapidly last year to 9.4% of GDP - as against a 10.6% target under the Programme;
- And Commission forecasts recently published suggest that the deficit will come in well below 8.6% of GDP target for this year.
Of course a huge amount remains to be done, and the challenges before us are great.
The top priority for this government will continue to be supporting job creation and reducing unemployment.
As Minister Noonan will emphasise later, we will continue to meet all of our commitments under the recovery programme, and to position Ireland for a return to the bond markets next year.
Just last month, the sixth progress report from the Troika once again confirmed that Ireland is very much on track.
The bond markets, too, are taking note of Ireland’s performance. Yields on 9-year sovereign bonds have more than halved since last July.
Internationally, Ireland’s determination and capacity to manage our affairs and to drive economic recovery are increasingly being noted and admired.
Government’s Approach to Jobs and Growth
But sticking to the terms of the EU/IMF programme is not the limit of this Government’s ambition.
It is my intention that, by 2016, Ireland will be recognised internationally as the best small country in the world in which to do business.
As a small open economy we will continue to strive for a stable and competitive business environment that will attract new foreign direct investment as well as grow indigenous industry.
We have many core strengths including our talent, our track record and our tax regime.
But above all, we have the capacity to innovate and create.
This is what underpins the growing rate of exports by Irish firms, and is what attracts so many foreign companies to locate in Ireland.
Indigenous Growth
2011 was a record year for exports by indigenous companies.
We are focusing both on building our trade with existing markets but also on expanding into new, high-potential markets.
I notice that today’s conference has a specific session on China, which very much reflects my Government’s focus on building our trade relationships with the BRIC economies.
As you may be aware the Chinese Vice President Xi Jinping visited Ireland in February. Ireland was the only EU member state in his itinerary which also covered the USA and Turkey.
My return visit to China proved to be very successful, and also included a very significant Trade Mission.
During the visit, I witnessed the signing of more than €35m worth of contracts and commitments.
I also concluded a Strategic Partnership Agreement with the Chinese Government which provides a framework for future cooperation between Ireland and China in a number of important trade and investment areas.
My priority now is to ensure that we maximise the opportunities for greater trade and investment in the months and years ahead, not just with China, but with other emerging economies.
We have a significant schedule of Trade Missions for 2012, targeting priority markets.
A number of innovative supports and programmes have been put in place during the past year to support indigenous companies in export markets.
For example, we have introduced a Foreign Earnings Deduction scheme to assist firms wishing to develop business relationships in the emerging markets.
Our indigenous enterprise Agency Enterprise Ireland have recently created a Potential Exporters Division and a new programme of supports to enable more indigenous companies to trade in foreign markets.
It has also recently launched a new Development Capital Scheme aimed at mid-sized, high-growth, indigenous companies with significant potential for jobs and export growth.
Inward Investment
Ireland also continues to perform very strongly in attracting Foreign Direct Investment.
Multinationals based here in Ireland employ at least 250,000 people across a range of sectors. Many of the world’s leading corporations continue to choose Ireland as a business location including;
- 8 of the Top 10 Global ICT corporations;
- 9 of the Top 10 Global Pharmaceuticals corporations;
- 17 of the Top 25 Global Medical Device corporations;
- More than 50% of the world’s leading Financial Services firms;
- 10 top “Born on the Internet” companies;
- 3 of the Top 5 Games companies.
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.
Action Plan for Jobs
Our focus on trade and investment is mirrored by our determination to support employment creation.
We are under no illusion about the scale of the job creation challenge facing us.
We have a long way to go before the unemployment challenge is resolved.
One of my key priorities as Taoiseach is to ensure that this Government works in a focussed and cohesive way to support businesses in creating jobs.
The Action Plan for Jobs, which was published in February of this year, is a key element of this Government’s approach to job creation.
It is an ambitious plan to support job-creating businesses and remove barriers to employment creation.
Already, there is clear evidence of progress across a wide range of issues. For example,
- We have improved the R&D Tax Credit regime and extended the corporation tax exemption for new businesses.
- We have launched the Succeed in Ireland scheme, aimed at creating 5,000 jobs within five years. This initiative provides direct financial incentives to people around the world to create employment in Ireland.
- We have issued a second global call for expressions of interest under Innovation Fund Ireland to attract top tier venture capitalists to Ireland.
- We have also announced the commencement date for two new immigration programmes aimed at stimulating investment and job creation in Ireland - the Immigrant Investor Programme and the Start-up Entrepreneur Programme.
But our extensive efforts to drive jobs and growth domestically can only be maintained in an atmosphere of economic stability at home and in Europe.
Conclusion
These are undoubtedly turbulent
times for Ireland’s economy and for the Eurozone.
However, there is a saying ‘Kites rise against, not with, the wind.”
And I believe it is clear that recent challenges have shown the true strengths of Ireland and its people - creativity, resilience and hard-work.
It is these qualities that are helping to bring Ireland back on the path of recovery.
And I am confident with our continued efforts and the support of the Irish people that this progress will continue.