Dáil Éireann Debate, Tuesday - 23 April 2013
95. Deputy Charlie McConalogue asked the Minister for Jobs, Enterprise and Innovation if he will request the Industrial Development Agency to produce a report into possible reasons for the poor performance in attracting new investments to County Donegal. [18638/13]
View answerIDA Ireland is the statutory body charged with the attraction of foreign direct investment to Ireland and its regions. I have been informed by IDA Ireland that in County Donegal it supports 14 companies which employ 2,228 people in software development, systems development and the medical technology industry. This represents an increase of 403 persons at work in IDA Ireland companies in the past two years, an increase of 20%.
The industry base in County Donegal is transforming from the clothing and textile industry to high tech, high skill activity. Accordingly, IDA Ireland continues to work with its existing client base to encourage it to transform and expand existing operations, while actively encouraging new investment in County Donegal in knowledge based industries and high-end manufacturing, mainly in companies in the medical technologies sector. In October 2012 KeyedIn solutions announced its plans to establish a software development centre in Letterkenny with the creation of 20 highly skilled jobs over three years.
The challenge facing IDA Ireland is to continue to win top quality investment for Ireland in a very challenging global environment. International competition for foreign direct investment has become extremely intense and continues to increase. Leading global corporations require a significant population pool, access to qualified talent, world class physical and digital infrastructure, as well as the availability of sophisticated, professional and business support services. This does create difficulties for regional locations and IDA Ireland has to focus on the main regional urban centres which are where the interest of most visiting investors will focus. IDA Ireland continues to seek every opportunity to bring investment to County Donegal.
IDA Ireland has also assured me that it continues to focus on the designated linked gateway of Letterkenny-Derry. This focus involves developing stronger economic links with Invest Northern Ireland which includes initiatives such as the north west business and technology zone, NWBTZ, which aims to promote the linked gateway of Letterkenny-Derry in line with the Northern Ireland regional development strategy 2025.
Additional Information not given on the floor of the House
I am mindful that, in order to ensure Ireland can continue to compete globally for FDI projects, it will be necessary to undertake an in-depth analysis of our FDI strategy with a view to informing the formulation of an appropriate strategy for the period post-2014. This analysis which will be undertaken later this year will take account of factors such as key trends emerging in FDI best practice internationally, Ireland's strengths in attracting foreign direct investment, changes to the European Union's state aid rules that may be introduced in the near future and our agreed approach to regional development.
The Minister has not answered my question, namely, if he will commission a report on the reason County Donegal has not been attracting its fair share of new investments in the past few years. He has rightly pointed to how well existing IDA Ireland companies in County Donegal have been doing, 14 of which between them employ 2,228 workers, an increase of 400 or 20% in two years. This shows the county is a place in which business can be done and that businesses which locate in the county can thrive. However, during the past few years none of the new investments in the country have been attracted to County Donegal. It attracted only one of the 88 new investments nationally last year. Of the 61 new investments attracted to Ireland in the previous year, none was attracted to the county.
We have only had 13 visits by companies in the past five years. That record is not good enough. A report investigating the reason we are not getting our fair share of new investments is needed. I have asked the CEO of IDA Ireland the question I am about to ask the Minister, to which I received a response that was non-committal. That is reason I am putting it to the Minister in the Dáil. Will he commission a report on the reason for this poor performance in order that it can be addressed and County Donegal can attract its fair share of new investments in the country?
I am surprised by the Deputy's comments. A 20% increase in employment in IDA Ireland companies is a good performance in my book. It probably exceeds the performance achieved in most, if not all, other counties. It is a strong performance. I agree that we continually need to examine our strategy and IDA Ireland will undertake an indepth analysis of our FDI strategy to inform its formulation for the period after 2014. We continually examine the sectors in which we can seize opportunities. As the Deputy will have noted, earlier in the week I launched our strategy for manufacturing which has the capacity to have a better regional spread. If one examines the make-up of IDA Ireland investments in recent times, there is no doubt that the investments being attracted are in sectors in which there are very deep labour market pools. There is a focus on urban centres, but there is also a real opportunity to develop existing and new sectors. Manufacturing is a sector that has further potential which we will be examining, but one cannot pick out one county and say, for example, that one has a strategy for County Donegal. We need to have a strategy for Ireland to win foreign investment and then we need to position the regions to have a competitive advantage whereby they can win investors. That is the approach and we will certainly actively continue to market County Donegal and position our overall policy to create employment in foreign owned companies.
The Government has a target of locating 50% of FDI projects outside Cork and Dublin. However, last year 75% of investments in FDI projects were in these cities. Only 9% were outside Cork, Dublin, Galway and Limerick. The Government plays a role in this regard. One might sometimes say it is market-led, but the botox firm located in County Mayo did not choose to locate in that county on the basis that the well turned out people of County Mayo meant it was a good place in which to locate such a firm. German financial firms did not locate in the docklands in Dublin because they thought it was a good place from which to do business. Governments can orientate FDI companies, but it takes political will to do so.
The time allocated for this question has expired.
I have a brief question.
I will allow the Deputy 15 seconds to ask it.
Thank you. Will the Minister arrange for the carrying out of a simple exercise, an assessment of the poor performance in regard to first-time investments? We have seen a number of actions by the Government in recent times which have made it more difficult to attract new jobs to my county. We have seen the Minister downgrade the IDA Ireland office in Letterkenny and remove gateway status from the town. There is also a much reduced commitment to the A5 project. There is obviously something that has resulted in County Donegal receiving less than its fair share of new investments compared to other parts of the country. If there are impediments, it is important that they be outlined and addressed in order that those of us involved in the political system can ensure they are tackled over time. I ask the Minister to conduct the simple task of commissioning a report on the reason there has not been the same level of performance in County Donegal considering the number attracted to the country.
I have given the Deputy some latitude. We must move on to Question No. 96.
