IDA half-year results very strong despite global investor uncertainty
IDA Ireland, the inward investment agency of the Irish Government, has reported a very strong first half of 2017. Investments approved by IDA in the first half will lead to the creation of over 11,000 (9,100 in 2016) jobs as companies roll out their plans over the coming months and years. Ireland won 114 projects in the first six months of the year. While the investment figure is at the same level as the first half of 2016 – the job content of the investments is higher due to some significant investments of scale.
Lifesciences, content and business services, technology and international financial services all performed strongly in the first half of the year. Brexit continues to represent both an opportunity and challenge for IDA Ireland and its client companies. The Agency has been in discussions with potential investors for over a year with the majority of the engagement being with Financial Services companies.
However, other sectors are now beginning to formulate plans based on the UK’s decision to leave the European Union. IDA is seeing an increasing number of Brexit motivated potential investments across a number of sectors.
Tánaiste and Minister for Enterprise and Innovation, Frances Fitzgerald TD said: “IDA Ireland’s record results for 2016 and excellent provisional results for 2017 show that Ireland continues to be one of the strongest performers in Europe in the foreign direct investment (FDI) sector.”
“Record numbers of new jobs were won. Hundreds of new investments, from companies across a range of different sectors, were secured. Real progress was made towards ensuring that foreign direct investment is spread right across regional Ireland.”
“We continue to have a great product to sell. We have a talented and dynamic workforce. We have a competitive and transparent taxation regime. We have a proven track record as a successful home to global businesses. And we have a hard-earned reputation as a country that supports and fosters enterprise.”
“It is this blend of qualities that allows the IDA to make a strong and effective case to prospective investors. With challenges ahead it is essential that we must remain focussed on enhancing Ireland’s competitiveness to ensure further investments are won for Ireland, whether they are expansions from companies already present here or new businesses arriving here for the first time.”
Martin Shanahan, IDA Chief Executive Officer said: “Today’s figures are very encouraging in the context of what were very ambitious targets set out in IDA’s Five Year Winning Strategy in 2015 – as an organisation, we are ahead of where we need to be at the midpoint of the strategy in terms of high level targets.
“The results are testament to the continued hard work of the IDA team across the globe that has successfully won investments for regions across Ireland. Achieving a spread of investments in line with our regional targets remains a challenge, but excellent progress has been made over the first two and a half years of the strategy.
“Geopolitical instability is the main threat that client’s see affecting the performance of their business in Ireland over the next 2-3 years. The positive results are an indication of just how important Ireland’s stable economic and political environment have become for investors. The twin challenges of both Brexit and a new US Administration have presented investors with much to think about. Indications suggest that investors believe that the new US administration may have more of an impact than Brexit.”
Commenting on the first half-year trends, Martin Shanahan, Chief Executive Officer said: “2017 has brought the competitive nature of winning foreign direct investment into sharp relief. Other jurisdictions are fighting hard for investment and Ireland must remain as competitive as possible in order to ensure that we continue to achieve the positive results that we are outlining today”.
Talent and skills availability is the number one issue on the minds of investors, in this context, our clients are very happy with the third level education system but believe that we need to address the areas of housing availability and cost, as well as personal taxation, in order to continue to attract and retain talent and win high levels of investment.
Client companies have also identified areas that Ireland is best at. Among other things, Investors have expressed satisfaction with Corporate Tax regime, labour force flexibility and the quality of our electricity and gas supply.
Shanahan added: “There are multiple factors that companies assess when making investment decisions. Ireland needs to make sure we are making progress on all fronts, all of the time.”
Evidence of the strength of Ireland’s proposition can be seen in the following views expressed by clients:
72% of clients plan to increase their headcount over the next 18 months.
50% of clients describe their growth prospects in Ireland as excellent/very good, with a further 43% describing them as good
76% of clients are trying to expand the mandate of their Irish operation