Press Release 07 Jul 2014

Monday July 7th, 2014 – IDA Ireland, the foreign investment agency of the Irish Government, said today the country’s foreign investment performance was buoyant in the first-half of the year, with a growing number of new greenfield investments, expansions and transformations by existing companies.

Over 100 investments were secured in the first six months of 2014, compared to 70 at the same time last year.   Of the investments secured, 40% have come from companies investing in Ireland for the first time, with the remainder represented by expansions and transformations by existing companies. The investments are supported by the Department of Jobs, Enterprise & Innovation through IDA Ireland.

Delivering an update for the first six months of 2014, IDA said the projects approved during the first half of 2014 will lead to the creation of 8,000 jobs this year and over future years as the companies roll out their investment plans.

(The full-year performance, including gross and net employment creation levels at IDA client companies will be measured via the Forfas Annual Employment Survey, to be released in January 2015).

During the first six months of 2014 there were investments in a range of regional locations including Limerick, Dundalk, Athlone, Galway and Mayo.   Among the companies publicly announcing investments in Ireland in the first half were:

Intel, Regeneron, Tyco, IBM, PayPal, Airbnb, Workday, Yelp, Alexion, Hewlett Packard, Biomarin, Johnson & Johnson, Survey Monkey, Ericsson, SmartBear, Hollister, SAP, HedgeServ,   AdRoll and Zendesk.  

The IDA’s Annual Report for 2013*, also released today, shows that at the end of 2013 there were 161,112 people now working at IDA client companies, a new record for the FDI sector in Ireland. Since late last year, IDA has also taken on responsibility for 55 companies in the Shannon region, bringing total employment at IDA client companies to 166,184 people. There were 13,376 gross jobs created in 2013.

Commenting today on the trends in the first half of 2014, IDA Ireland Chief Executive, Mr Barry O’Leary said “The first half has seen a strong FDI performance and Ireland is very much competing strongly in the global marketplace for inward investment. The IDA’s strategic concentration in recent years on emerging companies provided an additional boost to this performance.

The second half of the year looks equally encouraging, with IDA particularly concentrating on attracting first time investors. The value proposition Ireland offers global corporations, which rests on a complex blend of a strong talent pool, a proven track record, strong technology infrastructure and a 12.5% corporate tax rate, continues to resonate strongly with investors”.

The Minister for Jobs, Enterprise and Innovation Richard Bruton TD said “Continuing the strong flow of jobs growth from multinational companies is a crucial part of our Action Plan for Jobs. We have put in place a range of measures to support jobs growth in this area, including extra IDA staff overseas, an increase in the number of Ministerial trade missions and new advance facilities in regional cities and towns. In the past three years we have seen a total of more than 18,000 net new jobs created in multinational companies across the country. Today’s results shows that this trend is continuing and accelerating, and I am determined to continue making the necessary changes to ensure that we can continue this flow of job-creation across the country in the coming years.

“Finally, I wish to pay tribute to Barry O’Leary at this, his final press conference as IDA Chief Executive. Barry took over as CEO of IDA Ireland at the height of the financial crisis, but in the past three and a half years in particular he has overseen some of the strongest employment results in IDA’s history. He has been an excellent public servant in the crucial area of job-creation for several decades and I wish him every success with whatever the future holds”.

Economic Contribution on FDI:
IDA client companies now total over 1,100, with these companies making a substantial economic contribution to Ireland. As outlined in IDA’s annual report, these companies export almost €121bn annually, spending over €12.5bn in the Irish economy, via services and materials. Adding in annual payroll of €8bn, FDI companies spend over €20bn directly in the Irish economy annually, with all categories of FDI spending rising.

IDA estimates show that for every 10 jobs provided by foreign direct investment (FDI), another seven indirect jobs are generated for the Irish economy.

Pharmaceuticals:
Despite the patent cliff in the pharmaceutical industry, Ireland continues to win significant new investment particularly in the bio-pharmaceutical sector. Key investments won include Regeneron (Limerick), Alexion (Athlone and Dublin), Ethicon (Limerick), Jazz (Athlone) and BioMarin (Cork & Dublin).  IDA strategic focus on bio-pharmaceuticals is paying clear dividends.

Property/Construction Impact:
Due to the successful FDI performance of recent years, available property solutions are vital to continue growing Ireland’s portfolio of companies. Demand for prime office space in Dublin, in particular, remains intense and IDA welcomes recent news that An Bord Pleanála has approved a planning scheme for the Dublin Docklands Strategic Development Zone, providing capacity for the city in future years.  IDA looks forward now to companies accelerating their plans in that area.

In the construction sector, investments from Tyco, Hewlett Packard, Regeneron, Alexion, Jazz, Intel, Ethicon and other companies will generate significant construction activity at various sites throughout Ireland.

IDA itself is providing property solutions in regional locations such as Waterford, Athlone and Letterkenny, where the provision of such facilities will position the locations to win FDI.

Corporate Tax:
Corporation tax is an area of competition among countries seeking to attract inward investment and will remain so. However contrary to some commentary, it is not the sole decision making factor in winning major investments. Many international location consultants are now using up to 15 separate categories to score prospective locations.

The Irish government is actively participating in the OECD’s Base Erosion and Profit Shifting (BEPS) process and IDA believes Ireland is likely to be a beneficiary from any international reforms, as there is tangible substance (including capital investment, employees and risk) behind Ireland’s FDI sector, whereas some other locations do not have such substance.

Ireland’s long term interests are in winning FDI projects with tangible substance, in terms of employees and capital investment, and that will remain the IDA’s focus in the period ahead.

Stakeholders:
Ireland’s FDI performance rests on the efforts of a range of stakeholders across the wider government system. IDA would like to thank a number of Government ministers who participated in marketing trips during the first six months of 2014, including An Taoiseach, Enda Kenny TD, the Minister for Jobs, Enterprise & Innovation Mr Richard Bruton TD and the Minister for Finance, Michael Noonan TD.

IDA’s job creation performance forms a crucial part of the Government’s Action Plan for Jobs (APJ) initiative.

Outlook:
IDA said its pipeline for the second half of the year is promising:
“There remain significant economic challenges at home and abroad, but Ireland remains an attractive location for dynamic global companies and this was evident in the first half of the year,” said Mr O’Leary.

“Ireland’s FDI proposition is aimed at sectors where growth is continuing despite challenges in the global economy, and that should provide strong momentum in the second half of the year, with the pipeline looking encouraging.  An increasing focus on Ireland’s value proposition will ensure Ireland continues its position as one of the leading countries in the world for winning FDI. With so much growing competition for FDI the need for differentiation is constant,” he added.

“IDA has successfully implemented its Horizon 2020 strategy, and will shortly begin a process on devising a new corporate strategy for the organisation. FDI provides a major contribution to the wider Irish economy and that contribution will expand further in the period ahead”.

*IDA’s annual report for 2013 is also available at http://www.idaireland.com/news-media/publications/annual-reports/

 

For further information, contact IDA Corporate Communications:

Emmet Oliver/Kevin Sammon: 00353-1-6034017 or 353-87 6188564

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