That Dáil Éireann:
— the pioneering and transformative vision, under the leadership of Seán Lemass, with the introduction of the First Programme for Economic Expansion and others who followed in radically opening the Irish economy to foreign direct investment, FDI, and trade;
— the over 300,000 persons employed in foreign multinational enterprises across Ireland, with 200,000 people working in Industrial Development Authority, IDA, Ireland supported companies and service industries;
— that European Union, EU, exports to the rest of the world support one in every four jobs in Ireland;
— the success in attracting FDI to Ireland over many decades with United States FDI outflows to Ireland accounting for over $31 billion in 2016; and
— the attraction and retention of Ireland’s 12.5% corporate tax rate to retain and grow our FDI jobs footprint;
— the significant threat that Brexit poses for trade on the island of Ireland;
— that trade agreements benefit Ireland in terms of increased jobs, exports, and small and medium-sized enterprise business opportunities on the basis that as an exporting country Ireland stands to benefit disproportionately from the potential for expanded tariff-free market access;
— the independent study by Copenhagen Economics that the Transatlantic Trade and Investment Partnership, TTIP, would add 1.1% to gross domestic product in Ireland, increase Irish exports to the world by around 4% and create up to 10,000 jobs; and
— that free-trade agreements must ensure the maintenance of premier EU standards relating to consumer protection, food, health, environment, social and labour standards; and
— Ireland to further endorse free-trade agreements to intensify employment and export growth opportunities;
— the removal of barriers to trade via fair and free trade agreements, predicated on ensuring that EU standards related to consumer protection, food, health, environment, social and labour standards remain untouched;
— the support and endorsement of an ambitious Comprehensive Economic Trade Agreement, CETA, in order to open new markets and grow Irish jobs; and
— the expansion of diplomatic staff in Irish embassies and enterprise agency offices overseas.
I intend to share time with Deputies James Lawless and John McGuinness.
I am happy to put forward this motion in Fianna Fáil's Private Members' time to highlight the immense benefits that trade and foreign direct investment have brought to Ireland in terms of jobs, investment and export growth. I look forward to hearing from all Deputies and I hope we have a constructive discussion.
My party supports free trade and removing barriers to trade. This is essential for Ireland as Irish small and medium-sized enterprises need to be successful. However, we also believe that trade must be fair and must protect the positions of citizens and states.
Under the transformative steps and leadership of Seán Lemass, and others who followed him, the introduction of the first Programme for Economic Expansion contributed to radically opening the Irish economy to foreign direct investment and trade. The immense benefits of foreign direct investment to Ireland are irrefutable in the context of jobs. The Central Statistics Office recently revealed that 300,000 people are employed by foreign multinational enterprises in Ireland, providing high-quality jobs. Meanwhile, IDA Ireland, the State agency tasked with attracting investment to Ireland by foreign-owned companies, estimates that for every ten jobs generated by foreign direct investment a further five are generated in the wider economy. Furthermore, the footprint of US investment in Ireland has been significant, with up to 150,000 people directly employed here in over 700 US firms. The recent American Chamber of Commerce publication, The Transatlantic Economy 2017 – An Annual Survey of Jobs, Trade and Investment between the United States and Europe, highlighted the continued pattern in attracting foreign direct investment to Ireland over many decades. In 2016 alone, US foreign direct investment outflows to Ireland accounted for over €31 billion, that is, almost 20% of total US foreign direct investment in Europe. In addition, research and development expenditure by US affiliates in Ireland totalled €2.4 billion.
Our corporation tax rate is vital. The stability of our transparent tax regime over the years has been a key strength through our 12.5% corporation tax rate. Since the rate is a key policy lever, it is paramount that Ireland retains a competitive tax environment for inward investment. Retaining the rate is vital in this regard. Corporation tax receipts that accrue to the State are important for Exchequer funding and for investing in our public services.
While others on the hard left in this House wish to denigrate our corporate tax regime, it must be noted that Ireland's corporate tax rules are fully in accordance with OECD guidelines on taxation. It is interesting to note that Sinn Féin MEPs decided not to don the green jersey last year. Instead, they chose to abstain rather than vote against the European Parliament report that supported a European common consolidated corporate tax regime. This regime would be a retrograde step for Ireland's jobs and investment interests. There must be continued commitment by the State not to agree to any common consolidated corporate tax base and to ensure that EU treaty provisions continue to guarantee member state autonomy in setting corporate tax policy.
Trade agreements benefit Ireland in terms of increased jobs, exports and SME business opportunities. This is because as an exporting country Ireland stands to benefit disproportionately from the potential for expanded tariff-free market access. EU exports to the rest of the world support one in every four jobs in Ireland. Tariff-free trade has immensely benefited Ireland in the form of bilateral EU trade agreements with other jurisdictions. For example, the EU-Korea free trade agreement had a very positive impact with regard to investment and bilateral trade. There has been a significant increase in trade between Korea and Ireland since the agreement came into operation in 2011 with trade in goods increasing by 166% to €1.8 billion and trade in services increasing by 90% to €680 million.
Ireland must continue to remove barriers to trade by endorsing fair and free trade agreements to intensify employment and export growth opportunities. However, this is predicated on ensuring that EU standards relating to consumer protection, food, health, the environment, social and labour standards remain untouched. Ensuring the protection of premier European standards is a red-line issue that Ireland must uphold at all times in trade agreements.
Fianna Fáil fully supports the Comprehensive Economic and Trade Agreement, CETA, between the EU and Canada. The agreement will benefit Ireland in terms of increased jobs and SME business opportunities for Ireland. CETA will remove over 99% of tariffs between the two economies and create sizeable new market access opportunities in terms of services and investment. CETA will provide Irish companies with complete access to Canadian public tenders.
A strong trading relationship exists between Ireland and Canada. This is reflected in the €2.75 billion worth of annual trade between the countries. Indigenous Irish company exports to Canada have grown by over 250% in the five years to 2015 with a value of €185 million. It has been predicted that CETA will result in a €250 million increase in Irish exports per annum.
Fianna Fáil also supports the concept of the Transatlantic Trade and Investment Partnership agreement between the EU and the United States. This is based on the fact that, as an exporting country, Ireland stands to benefit given that 49% of Ireland's non-EU exports are with the US, while the average for the EU 28 countries is only 16%. While TTIP talks have stalled since the new Trump Administration took office, an independent study by Copenhagen Economics showed that TTIP would add 1.1% to gross domestic product in Ireland, resulting in an increase in Irish exports to the world by approximately 4% and could create up to 10,000 jobs.
While we support the general principles of TTIP, there is a caveat. The successful conclusion of the EU-US free trade agreement depends on maintaining proper European standards and on ensuring that the jurisdiction of our courts is not undermined.
Brexit poses a significant threat for trade on the island of Ireland, especially if any customs border were to return.
A very recent report by InterTradeIreland and the ESRI laid out how the imposition of World Trade Organization tariffs would be catastrophic for cross-Border trade. The €2.6 billion of cross-Border trade in goods could plunge by up to 17% if a hard Brexit transpires in the absence of an EU-UK trade deal. It is vital that the special status of Northern Ireland is recognised in any final trade deal, with unhindered trade continuing on the whole island.
Finally, our motion calls for the expansion of the diplomatic staff in Irish embassies and enterprise agency offices overseas to open new job opportunities and new markets, given how exposed we are to Brexit. Our current resource preparedness leaves a lot to be desired. The facts speak for themselves, with 65% of Irish embassies having only one or two diplomatic staff. Meanwhile, Enterprise Ireland has 25 overseas offices and IDA Ireland just 20 international offices. The allocation of €3 million in budget 2017 for increasing staff in agencies under the Department of Jobs, Enterprise and Innovation to meet the Brexit challenge was a drop in the ocean and totally inadequate. It is very concerning that to date in 2017, only 12 of the 39 posts have been filled by Enterprise Ireland while, under IDA Ireland, only one of the ten envisaged posts has been filled.
In conclusion, as an open economy heavily dependent on trade, Ireland needs to exploit all opportunities to increase trade, investment and exports to retain and enlarge our foreign direct investment jobs footprint. I hope that Members across the House strongly endorse this motion, firmly supporting trade and foreign direct investment as pillars of Irish industrial policy which have created hundreds of thousands of jobs for our citizens and increased exports over the four corners of the world.