Dáil Éireann debate -
Thursday, 12 Oct 2000

Vol. 524 No. 1

Written Answers. - Industrial Development.

Bernard J. Durkan

Question:

90 Mr. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment if she has satisfied herself that costs to industry are sufficiently competitive to facilitate continued confidence and investment; and if she will make a statement on the matter. [21855/00]

Tánaiste and Minister for Enterprise, Trade and Employment (Ms Harney)

As recent Competitive Challenge and Annual Competitiveness Report 2000 publications of the National Competitiveness Council indicate, we continue to improve our competitiveness. Both those documents have been laid in the Oireachtas Library. This improvement is reflected in the fact that Ireland now ranks fifth in this year's global competitiveness index compiled by the World Economic Forum; a remarkable achievement by any score.

Our success is attributed to our attractiveness based on a well designed incentive policy for high technology manufacturing, services and financial activities and our long-term investment in education, training and up-skilling programmes.

In our case it also underlines once more the imperative of securing a stable, predictable and moderate agreement between the social partners, as represented by the Programme for Prosperity and Fairness, PPF. That programme recognises the need to strengthen our main enterprise sectors, especially small business and the services sectors, promote indigenous industry, especially food, marine and forestry, address labour and skills shortages in the short and long term, accelerate the pick up of e-commerce and use of IT throughout our economy and government, and to take up the challenge posed by the exploration and exploitation of R&D in science and technology necessary to stay ahead.

I am satisfied, therefore, that with the PPF now in operation our cost competitiveness for both manufacturing industry and services will continue to generate both confidence and investment in our economy.

Bernard J. Durkan

Question:

91 Mr. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment the plans she has to take any initiatives or issue directions with the object of enhancing the textile and leather industries, having particular regard to the utilisation of available resources; and if she will make a statement on the matter. [21856/00]

Tánaiste and Minister for Enterprise, Trade and Employment (Ms Harney)

The principal raw material for the foreign owned textile companies based in Ireland is a chemical polymer which is 100% imported for the production of polyester and nylon fibres.

The indigenous textile industry is an industry that is based on traditional strengths. The changes within the industry have been market driven. In recent years the market has been a niche one supplying top end manufacturers and designers with wool and linen products. This market still remains but customers within it have become more demanding in terms of design and finishes.

In response to these market demands, Enterprise Ireland, in conjunction with the industry, identified a number of areas that could be improved in design and finishing. A number of initiatives to improve these areas have been undertaken recently and they include trend fore casting twice yearly, market study visits abroad, new product development support, and design improvement incentives.

A joint North-South initiative was undertaken earlier this year, involving Enterprise Ireland, Industrial Development Board, Northern Ireland, Irish Linen Guild, the International Fund for Ireland and nine participating companies, four from Northern Ireland and five from the Republic of Ireland. The objective of this promotional initiative was to jointly promote the linen and wool products of Ireland to international buyers overseas under the common brand Fabric Ireland. The project was launched at Premiere Vision, a leading world textile show, in Paris on 2 March 2000 and the outcome has been extremely successful. Companies report that buyer interest has increased following this promotion and are confident of attaining a 30% increase in sales over the next two years.

The Irish leather industry is focused on the manufacture of wet blue hides, which is an intermediate raw material sold to leather finishers outside the country. There is little, if any, production of finished leather in Ireland suitable for conversion into clothing, footwear, upholstery, etc.

Leather conversion and finishing operations have in general moved to low cost countries in the Far East due to lower labour costs. Primary processing of hides is tending to follow the conversion and finishing sectors to developing countries where, in addition to lower wage rates, environmental regulations tend to be less demanding.

One exception to this is the production of finished automotive and furniture upholstery. This is a very difficult market to break into because of the tendency of the automotive industry to work with a limited number of proven suppliers of finished leather. A few Irish companies here have developed outlets to these markets for wet blue raw material. Competition, however, is intense with major integrated US beef processors with large-scale operations dictating the economics of the business.