asked the Minister for Industry and Commerce the plans he has in his Department to provide greater incentives to (a) foreign companies to set up in Ireland and (b) native Irish industry and services for further job creation; if he is satisfied that existing incentives will be sufficient to prepare industry for the added competition and hazards of the Single European Market; and if he will make a statement on the matter.
Written Answers. - Industrial Incentives.
38.
Membership of the EC has already increased the competitive environment in which industry operates through the removal of the various tariff barriers and this has been reflected in the major restructuring of industry which has already taken place. While the completion of the internal market will undoubtedly bring increased competition for Irish industry it will equally create positive opportunities.
The NESC, in its detailed examination of Ireland's prospects in the European Community, took the view that the longrun benefits of market completion are likely to be unevenly distributed. It recommended that scale and innovation should be important elements in Ireland's industrial policy. The industrial development agencies are already focused on these aspects, which are fully reflected in the industry programme, which has been prepared by my Department and submitted to the EC for Structural Fund support. Particular emphasis is being placed on developing the management, marketing and technological capability of firms with resources devoted to these aspects doubling by 1993.
I would like to mention two programmes, in particular, which have an important role to play in helping companies meet the challenges and opportunities of the Single Market. The company development programme is designed to assist and encourage companies to take a strategic view of their development potential, market prospects and the appropriate developmental strategy to adopt to achieve an effective market presence. Two hundred companies have already been assisted under this programme. Many companies are being assisted under the programme a second time as they reach a further stage in their development. The national linkage programme is helping to develop a core of top-class Irish supply companies which can initially meet the purchasing requirements of the multinational companies located in Ireland and subsequently develop a real export presence. Seventy companies are being actively worked with under the programme. Both of these programmes are notable in that they operate on an inter-agency basis with the specialised skills of all of the State support agencies made available to individual firms.
I am of the view that the overriding priority is to build up our own indigenous industry and the vast bulk of State resources are devoted to this end. Nevertheless, I believe that our overseas owned manufacturing sector is a vital and permanent part of our economy, directly employing over 80,000 people and spending a total of over £3 billion in 1988 in the Irish economy. The overseas sector has brought improved management practice and skills to Ireland and has introduced us to new technologies and has helped compensate somewhat for the weaknesses of our indigenous industrial base. The advent of 1992 is opening up new opportunities for overseas investment in Ireland as EFTA, US, Japanese and other Far-Eastern firms are positioning themselves for the reality of the Single European Market. I believe that we are particularly well placed to capture a disproportionate share of that mobile investment as is evidenced by major recent project announcements such as INTEL and MOTOROLA from the US and BROTHER and FUJITSU ISOTEC from Japan.
It is quite clear that the performance of industry over the past two and a half years has been good with manufacturing investment, output and exports booming with a net growth in manufacturing employment. The success of the recent past makes clear that the most important contribution which the Government can make to the successful development of industry is the creation of a competitive and stable environment. This has been achieved, and will only be maintained, with the support of the social partners.
Ireland has in place probably one of the most sophisticated and comprehensive support packages in the world for the development of industry with the form and level of support geared to the particular requirements of the different sectors of industry. We have a competitive economy with low inflation and low interest rates, an attractive corporate tax regime, the availability of a highly skilled workforce, a comprehensive range of financial support mechanisms and a range of professionally staffed State support agencies.
I have no immediate plans to propose major changes in the incentives available for industrial development. I have arranged for my Department to fully examine the key industrial policy issues in the context of the second triennial review of industrial performance which is due for publication early next year.