I thank the Deputy for his questions. I will comment on all three elements because they are somewhat linked. In terms of regional development, the Deputy mentioned the central Border area but, of course, regional development is relevant across the island. The midlands would be another good example of the need for balanced regional development. I am more optimistic about regional development now than I have ever been and the reason for that is technological change. What the pandemic showed is that a lot of jobs do not have to happen within a 15 or 30 minute commute of an urban centre. From a policy point of view, working from home, flexible hours and flexible types of work mean that the tyranny of geography that was there in the past, whereby jobs were sucked into urban centres, is likely to be less pronounced over the next 25 years than it has been over the 20th and early 21st centuries. Technological change will provide opportunities for people to stay in low population density areas and perform some types of jobs, especially in professional services but also in areas such as ICT. People can be coders anywhere now; they do not have to be in Dublin, Limerick or Belfast, for example. The tyranny of geography when it comes to things like manufacturing may still be there to a certain extent but not for many white-collar type jobs. Obviously, other forms of technological disruption, like artificial intelligence, create difficulties in terms of white-collar jobs but nevertheless, in terms of developing out new economic models, those opportunities for regions that have benefited less over the past half century are more pronounced than they have been historically.
On inward investment, I would agree with my colleague that it is very unfair to compare Northern Ireland with the Republic of Ireland because the latter is an outlier by global standards. It is really at the top of the tree in terms of global FDI, most of which comes from the United States. That investment is motivated by various factors, including access to the Single Market, the English language, the legal system and, of course, the tax system as it was in place and not just the headline rate but also the panoply of associated tax breaks that surrounded it. Of course, now we are moving to a new global corporation tax system which will mean that effective corporate tax rates essentially have a floor of 15%. Corporation tax will no longer be the basis upon which jurisdictions compete for foreign direct investment.
It is certainly something that will not be effective in Northern Ireland. In addition, the foreign direct investment will come only if the human capital base is there, and the human capital base is not necessarily there in Northern Ireland at the moment. That will be quite challenging. Attracting those types of jobs will require reforms to education policy, reforms in terms of infrastructure, investment spending and so forth.
What are the models that are there in practice? As it stands, it would be a mistake to identify one country internationally and to say, "We want those policies." Those policies develop in a path-dependent fashion, and in many cases the countries' policies now evolved from their economies in the 20th century. What we actually need now is, as Mr. Mac Flynn said in his opening statement, to pick and choose successful policies in particular policy areas and apply them to the Republic of Ireland and to Northern Ireland. In many ways they will be the same policy sets. Ultimately, it will be about not only sustainable and inclusive growth but also full and high-quality employment, as Mr. Mac Flynn has described.
Northern Ireland's problem, as the committee knows, is one of low productivity. That is about poor-quality jobs. It is about how we transform that into a different dynamic. Unfortunately, it is a longer-term game played over decades in terms of educational reform but also in terms of shorter-term gains possibly on the infrastructure side and leveraging possible strengths that are manifesting now. For example, Northern Ireland's unusual position as part of the Single Market for goods creates an opportunity there.
There is no one answer or perfect model. It is not Sweden, it is not the United States, it is not Germany or whatever it might be. It is about identifying successful policies in particular areas and being a magpie and applying them to Ireland but in a 21st-century context, which is changing all the time. We talk about a just transition for climate but we also have just transitions in respect of technological change and we have those pending megatrends in terms of ageing demographics and so forth that we will have to deal with. It is new policies to an extent that we will need, and we need to be agile and open in how we treat that.
