Why Ireland for Brazil

This article appeared in the May/June edition of PIB magazine in Brazil

Michael Hoey
Ambassador of Ireland to Brazil

When I arrived in Brazil as Ambassador in August 2006, I was able to tell my Brazilian hosts of the dramatic economic development of Ireland over the past 10 years. The “Celtic Tiger”, as the Irish economy was known was now one of the world’s most dynamic, open and globalised economies, with extensive external trade and investment links. As a member of the European Union, Ireland is part of a single market of over 400 million people and shares a common currency, the Euro, with 15 other European Union (EU) Member states.

Ireland is now much better known to Brazilians because each year over 4000 Brazilians choose Ireland for further study and more than 20,000 Brazilians moved to Ireland, taking advantage of the growing economy. In the town of Gort in the West of Ireland almost 40% of the population is Brazilian. Many come from Anápolis, Goiás and some have painted their houses there in the colours of the Irish flag – green white and orange!

Ireland and the Global Economic Downturn
In the last year, Ireland like many other countries has been affected by the global economic crisis. GNP is expected to decline by 4.5% and unemployment to rise to 9% in 2009. The Irish Government has been taking strong correctional measures and is already spending 5% of GDP on capital infrastructure. This is Ireland’s equivalent of recently announced economic stimulus packages in other economies.

In January 2009, the credit rating agency Fitch affirmed Ireland’s “AAA” credit rating. This was an important positive signal on the Irish Government’s ability to mange and respond to the global economic downturn. Ireland now has the capacity to grow at an annual rate of 3% up to 2015. Ireland has a well educated labour force and has an open developed economy which is flexible in allowing it to respond to adverse developments.

Opportunities for Brazilian Companies:
Innovation and dynamism which characterises so much of Brazilian industry is also found in Ireland. It is therefore disappointing that more Brazilian companies have not considered the possibilities that Ireland can offer. In contrast, a small number of Irish companies now have a presence in the Brazilian market, such as the Irish food company Kerry which has a factory in Campinas, Sao Paulo and employs over 600 people in their Brazilian facilities.

Brazilian companies should know that Ireland may be the best place to consider as a gateway to the European Market.  Global corporations who have come to Ireland see it as a business location where the workforce, as well as being highly qualified, has a unique capacity to improve, to innovate and to initiate new processes that can make business more dynamic, more efficient and ultimately more profitable. Strong working partnerships between academics and international firms are increasing day by day.  That is why almost 1,000 overseas companies have made Ireland their location of choice.

Corporate Tax Rate in Ireland
Of particular interest to investors are the taxation regulations for inward investment and again Ireland has much that is attractive. Ireland’s corporation tax rate is 12.5% on all trading profits, and is open to all enterprises both indigenous and multinational. The Irish tax system is open and transparent and the 12.5% rate is available to all investors. A tax rate of 25% applies to non trading income.

Role of IDA Ireland – Ireland’s Inward Investment Promotion Agency
Brazilian companies interested in considering Ireland for investment can contact Ireland’s inward investment promotion agency, IDA Ireland (Industrial Development Agency) which has the full support of the Government of Ireland. Companies that are already using Ireland as their European base are involved in sectors as diverse as e-Business, Engineering, Information Communications Technologies (ICT), Life Sciences, Financial and Globally Traded Business Services.

Let me give some examples: Intel chips for the European Middle East and African marketplace are made in Ireland. Leading global internet companies now have major operations in Ireland e.g. Google, Yahoo, Amazon, eBay, Facebook and PayPal to name but a few. Fourteen of the top fifteen pharmaceutical companies in the world have an operational presence in Ireland including Pfizer, Johnson & Johnson, GlaxoSmithKline, Schering Plough and Wyeth Medica.  Ireland is also one of the largest exporters of software in the world. Companies like Intel and Wyeth carry out some of the most complex manufacturing operations in the world in Ireland.

I hope that Brazilian investors will see that Ireland offers them a stable, profitable, English speaking base to service world markets.


Note: IDA Ireland’s representative in Brazil is Ms Renate Buzon:

Renate Buzon –IDA Ireland / Brazil
Av. das Nações Unidas, 12551 - 17 andar
04578-903 S. Paulo – SP
Tel.: +55 11 3443-7760
Mobile: +55 11 8186-8661
Email: renate.buzon@ida.ie