Post on 16-Dec-2015
transcript
Presentation by: Jennifer Condon & Doreen Mc Keown
State involvement in Industrial Development in Ireland
Enterpr ise I reland
Development of I r ish O wned I ndustry
I DA I r eland
I nward I nvestment by M N Cs
For f as
D epa rtm en t o f E n terp rise T rade & E m p loym ent
Agenda
The “Celtic Tiger Economy” The environment supporting Industrial
Development in Ireland Multi-National Industry in Ireland Irish Owned Industry Doing Business in Ireland
The “Celtic Tiger” Economy
Historical Perspective
1922: Ireland achieves independence 1920s - 1950s: primarily agricultural Late 1950s-1960s: Policy of Direct Foreign Investment 1960s-1970s: Process of industrialisation 1973: Ireland joins EU 1980s: Stagnation 1990s: Rapid growth
4.5
2.6
8.8
7.0
10.4
7.7
10.8
8.9
7.0
0.0
2.0
4.0
6.0
8.0
10.0
12.0
%
1986-1990 1991-1993 1994-1998 1994 1995 1996 1997 1998 1999 (f)
Annual Real GDP Growth 1986-1999
Europe’s Fastest Growing Economy
9.24
3.42 3.36 3.14 32.34 2.3 2.28
1.84
0123456789
10
%
Average growth in real GDP 1995-1999
Source: OECD Economic Outlook, 1999
(1999 projections)
GDP Growth 1994-2000
(Source: OECD)
Ire OECD EU Swe Fin Neths Den UK
10.5 3.3 3 2.9 4.4 3.2 3.2 2.9
7.59.3
7.8
1820 20
14.516.4
12.5
0
5
10
15
20
1991 1992 1993 1994 1995 1996 1997 1998 1999
%
Manufacturing Exports 1991-99 (Annual Volume Rise)
Export-led Growth
Exports Exports Imports Imports
1990 1999 1990 1999
% % % %
UK 34 22 42 32
EU 44 42 27 22
N America 09 16 15 17
Other 13 20 16 29
Trade Diversification
LABOUR FORCE DEVELOPMENT1980-1990: lagging behind…...
-100,000 0 100,000 200,000 300,000
Population
EMPLOYMENT
Labour Force
UNEMPLOYMENT
+105,000
+62,000
-22,000
+84,000
LABOUR FORCE DEVELOPMENT1990-1998: racing ahead…...
-100,000 0 100,000 200,000 300,000
Population
EMPLOYMENT
Labour Force
UNEMPLOYMENT
+202,000
+273,000
+293,000
-40,000
MIGRATION:the flow reverses…...
-30000
-20000
-10000
0
10000
20000
30000
INFLOW
OUTFLOW
1980 1990
2000
The Environment Supporting Industrial Development in Ireland
Macro-Economic Policy Framework
Investment in Education
Investment in Telecommunications
Reduction in Tax Burden
Reduction of Public Debt
Partnership Process/Negotiated Governance
Ireland’s Demography
Total PopulationTotal Population
Labour ForceLabour Force
Full-time EducationFull-time Education
3.66 million3.66 million
1.51 million ( 41% )1.51 million ( 41% )
0.95 million ( 26% )0.95 million ( 26% )
Availability of Skilled Labour
Free Education policy at second level & University 7 Universities & 13 Institutes of Technology All primary & secondary schools have Internet
connectivity Education Technology Investment Fund – supported the
development of Technical Degrees Projected 40,000 per annum new entrants to labour force
to 2006 Over 50% graduates have technical qualification Close liaison with industry to assess skill & number
requirements
Investment in R&D
Research & development in Universities & Institutes of Technology
National MicroElectronics Research Centre – Cork Science Foundation Ireland
Informatics Bio-Technology
Media Lab Europe
Major Advances in Telecommunications Infrastructure
U.S.$5bn investment in digital networks
Full liberalisation of telecoms market
Major new investment to extend
Broadband access regionally
Current broadband
capacity between
main towns and cities is
2.5Gbit/s
Dublin, Galway, Limerick and Cork linked
with 40Gbit/s capacity
Broadband backbone capacity
Taxation Policy
Corporate Tax Profits derived from eligible manufacturing
and qualifying services are subject to a tax rate of 10% until 31 December 2002 and 12.5% from 1 January 2003.
Capital Gains Tax halved to 20% since late 1990s
Reduction of Personal Taxation (partnership agreement balance against wage restraint)
General Government Debt as % GDP
110.6
93.1
52
39
0
20
40
60
80
100
120
1988 1993 1998 2000
% GDP
Partnership process
Five tri-partite programmes of growing sophistication since 1987
1987: “National Recovery” 1991: “Economic and Social Progress” 1994: “Competitiveness in Work” 1997: “Partnership 2000” 2000: Partnership for Prosperity & Fairness
Other key Factors
Legislative Framework eCommerce Bill Copyright Establishment of Independent Telecomms Regulator
Strategic deployment of EU Structural and cohesion funds through the National Development Plan
Information Society Commission Initiative Programme for eGovernment
Multi-National Industry in Ireland
The role of IDA Ireland?
State Agency
Funded by Government Targets Foreign Direct Investment into Ireland as a key
element of Ireland’s economic development strategy Assists existing companies to build and strengthen
strategic value in Ireland
Provides incentives for foreign investors
IDA Strategy
Sectoral Focus (we can’t be good at everything)
Concentrate on our Strengths People Skills EU Access (Euro Adoption – English Language) 10% Corporate Tax Rate (to 31/12/2002) Excellent telecommunications Competitive costs
Focus on High Growth Sectors
Key Sectors
Information Technology Pharmaceuticals/Healthcare International Services
Software Teleservices/Shared Services
Financial Services - IFSC eBusiness
Information &Communications Technology
Apple Computer 3Com Compaq Dell Ericsson Fujitsu General Electric
• Hewlett-Packard
• Hitachi
• IBM
• Intel
• Motorola
• NEC
• Nortel
• Sun Microsystems
• Xerox
300 companies - 67,000 employment
Exports: IR£13 billion
Pharmaceuticals & Healthcare
Abbott American Home Products Bausch & Lomb Baxter Boston Scientific Bristol- Myers Squibb Elan Eli Lilly Johnson & Johnson
• Leo Laboratories• Medtronic• Merck• Pfizer• Pharmacia & Upjohn• Roche• Schering-Plough• Glaxo SmithKline • Yamanouchi
No. 1 location in Europe155 companies - 19,000 employmentExports: IR£12 billion
International Services – including Software
• Gateway 2000• Hitachi• IBM• KAO Infosystems• Lotus• Merrill Lynch• Microsoft• Motorola• Oracle• Philips• Sun Microsystems• UPS• Whirlpool
DECDellEricssonDECDellEricssonSAPComputer AssociatesAccenture
Financial Services - IFSC
AGF American Airlines AOL Bertelsmann Apple Bankers Trust Bear Stearns Chase Manhattan Citibank Compaq Credito Italiano
507
188
168
222 5960
USUKGermanyRest of Europe
Asia/PacificRest of World
Source of Foreign Investment
Unique Importance of FDI
1,200 IDA-assisted companies
> 140,000 employed
> 50% of manufactured output
> 80% of manufactured exports
> 35% of GDP
€15.1b Irish Economy Expenditure
€1,650m corporate tax paid
Technology and management skills
Future Focus – eBusiness & Digital Media Most competitive infrastructure/deregulation Legislation
Non-discrimination between electronic/paper transactions Copyright/Intellectual Property
Business-friendly environment Digital Media District Excellent connectivity National Digital Park
The Development of Irish Owned Industry
The role of Enterprise Ireland
Semi-State Agency - funded by Government Focused on Irish Owned Companies Identify and assist High Potential Companies in the
process of their business development Emphasis on companies with potential for
Internationalisation and exports Foster innovation in companies
Enterprise Ireland Strategy
To help client companies develop a Sustainable Competitive Advantage leading to increased profitable sales, exports and employment
The client base of Enterprise Ireland will be comprised of companies which are Irish based and whose growth and development can be enhanced through working with Enterprise Ireland
Over 90% of Irish Owned Companies are SMEs
EmployingCompanies Sales JobsExports
TOTAL 100% 100% 100%100%
Under 10 19% 2% 2%3%
10-50 63% 25% 33%21%
50-250 16% 35% 35%35%
250 + 2% 38% 30%41%
Current Structure by Sector
Food£11B (55%)
Internat'l Services
£2B (12%)
Consumer5%
Industrial Products£5B (28%)
SALESSALES
Current Structure by Sector
Food£5B (61%)
Internat'l Services
£1.1B (13%)
Consumer6%
Industrial Products
£1.7B (19%)
EXPORTSEXPORTS
Current Structure by Sector
Food37%
Industrial Products
46%
Consumer6% EMPLOYMENTEMPLOYMENT
InternationalServices
11%
Exports by Market Region (Growth)2000
UK EUROPE US ROW
£3.5B
(+10%)
£2.3B
(+17%)
£1.2B
(+25%)
£1.0B
(+18%)
TOTAL
Sectoral Trends
Emergence & Growth
Decline
Software I.T
PreparedConsumer Foods
Textile & Clothing Commodity Foods
Selected Sectors
Sectors
Software and International Services (700+ companies)
Healthcare, Pharmaceuticals, Chemical, Print & Packaging, Construction (700 companies)
Electronics and Precision Components (350 companies)
Engineering (350 companies)
Irish Owned Software Companies
Over 640 Irish owned companies
40-50 new high potential start-ups annually
Revenue Over £1 Billion
Revenue growth 20% + per annum (95-00)
Export growth 25% + per annum (95-00)
Exports represent 75% + of production (‘00)
USA largest market for Irish software companies - 36% of exports
Irish owned Healthcare Companies
75 companies Includes 10 of the top 15 Medical Device companies
Medical Disposables Opthalmic Products Orthopaedic implants Medical Electronics Diagnostics Kits
Niche companies in Medical Devices, Components,
Pharmaceuticals, Diagnostics, Chemicals and Biotechnology Small Players internationally/no strong proprietory technology Employment 12,500 Annual Exports US $2bn
Irish owned Biotech Sector
18 companies / total of 348 people employed
Key players are Trinity Biotech, Biotrin, Megazyme and Plant Technology - collectively employ 248
Trinity Biotech and Megazyme had their origins overseas
All companies were established over the past 10 years
Growth in employment has averaged 26.5% over the period 1995-1999
ElectronicsCompany Focus
Electronics Subsupply Telecommunications Process Control – particular growthInstrumentation
Proprietary TechnologiesNiche MarketsSuppliers to MNCsSub-contract manufacture
Software
Electronics
Localisation
Shared Services
Call Centres
Financial Services
Medical & Healthcare
Future focus – Internationally Traded Services
Future Key Opportunity Sectors
Informatics including software
Digital Media
eBusiness – transition & new businesses
Healthsciences – including Bio-informatics
IR£m IR£m
Exports Imports
1997 11.508 1.997
1998 7.348 4.328
1999 6.302 5.155
2000 9.486 11.332
Ireland - Lithuania Trade
Doing Business in Ireland
Why companies choose Ireland
Unique Return on Investment
Unique Return on Investment
Competitive Cost Environment
Competitive Cost Environment
Highly educated and flexible workforce
Highly educated and flexible workforce
EI / IDA Assistance
EI / IDA Assistance
Low Corporation Tax
Low Corporation Tax
Telecommunications Infrastructure
Telecommunications Infrastructure
Supportive Business Environment
Supportive Business Environment
Ireland – a key location in the EU
• EU: 370m Single Market
• EURO implementation
• English Speaking
• Export orientation
• Business friendly environment
• Equal treatment for foreign/Irish businesses
Doing Business in Ireland
Think Partnership – mutual benefit Remember the size of the Irish Market Many Irish Companies are focussed on opportunities in
markets outside of Ireland High tech companies are particularly export oriented Agencies can help – BUT they need to be clear about
your requirements!