Speech by the Taoiseach, Mr Bertie Ahern T.D. at a business lunch the Boston College Club, on Thursday, 1 May, 2008
I am delighted to be able to join you this afternoon at the Boston College Club and I want to thank all of you for your warm welcome. It is a great pleasure for me to be back in Boston again, a place where so many generations of Irish have settled and succeeded.
The Irish have, over the course of hundreds of years, made many significant contributions to Boston and Massachusetts and their imprint can be found in all aspects of life in the City and State.
The presence and success of past Irish generations has fostered close links between Massachusetts and Ireland, underpinning our economic relationship which continues to develop with the growth and advancement of our own economy.
Relations between the peoples of the United States and Ireland have never been better. We are visiting one another in ever increasing numbers and we are trading with one another in ever greater volumes. Ireland continues to attract valuable inward US investment but Irish business is now also investing heavily in this country.
Global Economy
Let me touch briefly on the global economy as evidence of a slowdown in many of Ireland’s major trading partners continues to mount. Financial market disruption – triggered last summer by difficulties in the market for sub-prime mortgage debt – has persisted for longer than initially expected. The effects are also spreading to other sectors. The outlook for many of Ireland’s key trading partners has correspondingly weakened. As a small, globally-integrated economy, we in Ireland cannot remain immune from these trends. But are working very hard to ensure that we are well positioned to meet the challenges that lie ahead.
Notwithstanding these new conditions, it is clear that the fundamentals of the Irish economy remain healthy. We have a young, outward-looking and dynamic population. Our markets, including the labour market, are extremely flexible by international standards. We are implementing sound fiscal policies in order to maintain a low burden of taxation on both capital and labour while keeping our level of public indebtedness low. We are maintaining an efficient regulatory environment which does not add to the burden on firms, thus safeguarding our pro-enterprise culture. Our workforce is well educated, especially with market-oriented skills relevant to high technology industries.
Ireland’s National Development Plan
We also have a blueprint – in the form of a National Development Plan – which will help to take us to the next stage of our economic development. This Plan provides for the deployment of significant resources in order to enhance the productive capacity of the economy and lay the foundations for future improvements in living standards.
Investment in physical capital is being prioritised under the Plan. To put this into context, public capital investment will average around 5½ per cent of national income over the period to 2013, a very high figure by international standards. The aim of this investment is to enhance productivity and improve competitiveness.
Investment in Skills and Research
Investment in human capital also forms a crucial part of our National Development Plan. While all education levels are being targeted, investment in higher education is especially important. This deepening of the skills pool will help us to continue to
re-position our economy in the production of knowledge-intensive goods and services. The Plan also contains measures to promote higher levels of fourth level education, in recognition of the premium on knowledge-creation in the global economy.
Our strong relationship with the U.S. will be vital to the achievement of these objectives. In 2000, we established Science Foundation Ireland, modelled on the US National Science Foundation. Through SFI, we are actively encouraging international research collaboration as a means of strengthening our research base. We are focusing in particular on research and development in biotechnology and information and communications technologies. Our goal is for Ireland to be recognised as the ‘land of saints, scholars ... and scientists’.
We recognise that investment and development of human capital is a life long process. A range of new measures have been put in place to assist with worker training and upskilling and greater participation in formal education. Our “One Step Up” initiative aims to encourage continual upskilling by employees by giving them access to a full range of skill development opportunities and providing financial support to employers who provide appropriate training.
Irish Investment in the United States
At the start of this year, The New York Times ran an article titled ‘Ireland is alive with enthusiasm for entrepreneurship’-
And these entrepreneurs have global ambitions.
Irish companies now employ over 80,000 people across all 50 States. This number has increased 10 fold in the last 10 years. Last year alone, 47 companies opened an office in the US and there are now over 50 Irish companies with a presence in New England.
The US market is a key market for Irish indigenous industry with estimated growth figures for 2007 being in excess of 16%. This is very impressive growth in light of the current economic conditions and the weak dollar and is testament to the calibre of Irish companies and their ability to compete in the global market.
Here in Massachusetts, this is demonstrated by the presence for many years of Enterprise Ireland which supports hundreds of companies who are keen to do business in the region.
The Role of Foreign Direct Investment
As Ireland continues the transition into a leading 21st century knowledge based economy, the significance of foreign direct investment to Ireland’s future growth and economic prosperity should not be underestimated. Employment in multinational companies directly accounts for over 136,000 jobs or 42% of Industrial and Financial employment in the economy.
IDA Ireland has continued to focus on winning inward investment from top-tier corporations and companies within a number of high potential business sectors including Pharmaceuticals and Biotechnology, Medical Technology, Financial Services, Digital Media and Information Communications Technologies (ICT).
For many U.S. and New England companies, Ireland continues to be a critical international gateway to markets in Europe and beyond; a location of young, highly educated and adaptable employees and an environment that is attuned to the needs of business.
As you are well aware, business competes in a knowledge intensive environment; an environment for which Ireland is well prepared. We also live in an environment of constant change. It is the ability of each of us to grow, adapt and lead that will define how successful we will be in the future. It has been Ireland's ability to be innovative, to lead and to deliver opportunities in times of change that has marked our success.
In a World economy which is facing a number of challenges, I am pleased to be able to give this audience, many of you who represent important customers and clients of our State development agencies, an assurance that Ireland is responding to these challenges from a position of strength.
We have an efficient, flexible, pro-enterprise economy with a highly skilled and adaptable workforce. We are implementing sound fiscal policies aimed at maintaining a low burden of taxation. We are prioritising resources towards boosting the productive capacity of the economy.
We in Ireland will continue to work hard to create and sustain an environment for international business that is business friendly, flexible, politically stable and uniquely competitive.
The policies which have served us so well will be adapted to new challenges. But they will continue.
Thank you.
ENDS