Written Answers. - Currency Differentials.
Dermot Ahern
Ceist:
94
Mr. D. Ahern
asked the
Minister for Enterprise and Employment
if his attention has been drawn to the difficulties being experienced by a number of industries in the Dundalk area of County Louth, particularly in view of the Punt/Sterling differential.
[10684/96]
I am aware of the difficulties being experienced by companies in the Dundalk area, including concerns regarding the impact of currency movements on their competitiveness. Sterling has fallen by about four per cent against the punt since the end of 1994. The relative values of the currencies now means that there are benefits for some companies in terms of lower import costs, as well as competitive challenges for others. Overall, however, the punt has maintained a stable position against a basket of currencies among our trading partners.
It is, of course, in the first instance a matter for each individual firm to make the arrangements required to cope with the prevailing economic environment. The Government, however, does have a role in ensuring that the economic climate is as conducive as possible to economic activity, including exporting. In this regard, the current economic environment in Ireland is characterised by sound public finances, high growth, low inflation, interest rates at historically low levels, a high level of investment and moderate wage developments in line with theProgramme for Competitiveness and Work. All of these factors are beneficial to economic activity.
In addition, in each of the last three budgets, considerable Exchequer resources were allocated to employers through reductions in their PRSI contributions. This was done to assist employers to maintain and create employment and was targeted at lower-paid, labour-intensive and mainly indigenous sectors of Irish industry.
The recent announcements of job losses and lay-offs in Dundalk-based firms were the result of competitive pressures in the electronics sector in the main coming from low cost countries. In my reply to an Adjournment Debate on 14 May, I dealt with the question of job losses in Dundalk.
I take this opportunity to reassure the Deputy that State agencies will continue to do their utmost to assist existing companies and to attract new investments to the Dundalk area. In this regard, I am sure the Deputy will welcome the announcement during my visit to Dundalk last week of the decision by EPC to establish a project in Dundalk which will employ some three hundred people at full production. In addition, I announced that IDA-Ireland, through private sector investment, is arranging for the construction of a new 25,000 sq. ft. advance factory in Dundalk as a new asset in the urgent promotion of the area for investment. I am confident that these initiatives and the strong interest shown by potential investors will translate into strong jobs growth and economic development for the Dundalk area.
