Written Answers Nos. 42-61
42. Deputy Micheál Martin asked the Tánaiste and Minister for Business, Enterprise and Innovation if officials in her Department have a role in monitoring developments on the concentrated effort of China opening its markets and dominance in world trade; and if there will be increased resources allocated to Ireland's agencies in China. [45044/17]
Amharc ar fhreagraMy Department has prioritised China as a marketplace with significant potential for Irish manufacturing and services and over the last number of years has allocated more resources to this market. IDA Ireland opened its first Chinese office in Shanghai in 2006, and then established an office in Shenzhen in 2010 and Beijing in 2013. Enterprise Ireland have offices in Beijing, Shanghai and Hong Kong.
Bilateral trade between Ireland and China is worth over €8 billion each year. Ireland’s priority sectors for trade with China include agriculture, education, financial services, culture, and tourism. Exports to China by Irish-owned companies increased by over 49% in 2014, while a total of 92 Irish companies employ over 10,000 people in China.
On 11th February, 2015, following a concerted effort by the Government over several years, the Chinese authorities lifted their longstanding ban on imports of Irish beef into China. This covers “off the bone from animals up to 30 months old at slaughter”. It places Ireland ahead of all other EU member States on the road to opening the Chinese beef market. Bord Bia anticipates that China will become Ireland’s 2nd largest market for food and drink exports in the coming years.
Successive Ministers and Taoisigh have led trade missions to China and we have also received visits from the highest levels of leadership from China to promote trade links between our two Countries. On the 16th-19th January 2017, Minister Eoghan Murphy travelled to China with Enterprise Ireland. The aim of the trade visit was to support the increasing number of Fintech companies targeting the Chinese market as part of Enterprise Ireland’s ongoing focus on market diversification and the growing cooperation between Ireland and China. One of the aims of the Enterprise Ireland 2017-2020 corporate strategy is to ensure that Irish fintech companies are well positioned to continue to grow their business and make new business contacts in China. Enterprise Ireland is working collaboratively with IDA Ireland to achieve the IFS2020 strategic goals which include increasing the number of start-ups, increasing the number of direct employees by 10,000 and driving innovation and research in the sector.
On 21st August 2017, the Taoiseach announced Government plans to double Ireland’s global footprint by 2025. My Department is in discussions with DPER in relation to the allocation of additional resources to deliver on one of the key aims of Ireland’s Global Footprint 2025, which is to attract greater investment in Ireland and increase our exports into key strategic markets like China.
A comprehensive EU-China Investment Agreement is currently under negotiation, which will provide Ireland and other EU Member States with increased market access. Ireland is fully invested in this agreement and supports the European Commission as lead negotiator in the ongoing negotiations.
43. Deputy Sean Sherlock asked the Tánaiste and Minister for Business, Enterprise and Innovation the measures taken under gambling legislation to monitor excessive in-game purchases for children under 18 years of age. [49687/17]
Amharc ar fhreagraAs the Minister for Justice and Equality has responsibility for gambling legislation, I am not in a position to say what measures, if any, are taken under such legislation to monitor excessive in-game purchases by children under 18 years of age. The Consumer Protection Act 2007) which gives effect to Directive 2005/29/EC on Unfair Commercial Practices contains provisions of general application on unfair, misleading and aggressive commercial practices) may be relevant to in-game purchases in some cases. If the Deputy has reason to believe that in-game purchases in games aimed at children involve misleading, aggressive or unfair commercial practices, I suggest that he provide details to the Competition and Consumer Protection Commission which is responsible for the enforcement of the Act.
44. Deputy Stephen S. Donnelly asked the Tánaiste and Minister for Business, Enterprise and Innovation the spend on social media campaigns by her Department and the agencies under its aegis on issues related to Brexit; the spend by campaign per platform and State agency; and if she will make a statement on the matter. [49754/17]
Amharc ar fhreagraMy Department has not had any expenditure on social media campaigns on issues related to Brexit. In the time available, it has not been possible to provide information on expenditure by agencies under the aegis of my Department. I will provide this to the Deputy once it is collated.
45. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the degree to which she remains confident of this country’s ability to attract foreign direct investment here notwithstanding issues raised at EU level to the effect that enterprises setting up headquarters here and liable for 14.5% corporation tax may also be compelled to collect taxes on foot of profits made in other jurisdictions; if this is likely to dissuade foreign direct investors coming here; and if she will make a statement on the matter. [49774/17]
Amharc ar fhreagraThe major ongoing reform proposals in the EU with regards to Corporation Tax surround the Common Corporate Tax Base (CCTB) and by extension, the Common Consolidated Corporate Tax Base (CCCTB).
The CCTB is being discussed first and only after it has been agreed will discussion move on to the CCCTB. By its nature, the CCTB is a complex and detailed proposal and Member States need to fully analyse and consider its potential impact on national tax systems. Member States are discussing and debating the various aspects of the proposal in the relevant tax working parties. In line with the Programme for Partnership Government, Ireland is engaging constructively with the proposal while critically analysing whether it is in line with Ireland’s long-term interests.
Proposals seeking new approaches to taxing large digital businesses have also been discussed recently. The OECD is currently carrying out important work on this area and is expected to publish an interim report in the first half of 2018. Ireland recognises the need for work in this area but believes that it would be premature to take action without considering the OECD analysis. Ireland believes that a consistent global approach is needed and that any solution must build on a shared understanding of where value is actually created by digital business.
All of these discussions are at a relatively early stage and the implications, if any, will depend on the exact nature of any changes which are ultimately agreed. It is important to remember that tax remains a matter of Member State competence and unanimity is required before any proposals can be agreed.
Notwithstanding potential reforms in the future, Enterprises locating real substantial activity in Ireland will continue to be subject to Irish tax at 12.5% on their profits properly attributable to activity located in Ireland.
Enterprises will always want to have operations in the EU, and taxation, whilst important is only one element of our continued attractiveness to FDI. For instance, the Institute for Management Development (IMD) ranks us as the 6th most competitive country globally. Ireland also scores very highly in terms of key criteria for FDI including investment incentives, labour productivity and the adaptability and retention of talent. As recognised by the IMD, many of Ireland’s traditional assets including our education system, highly skilled workforce and pro-enterprise business environment add to our competitive advantage and are extremely attractive to inward investors.
The State has a long track record of winning overseas investment, in that time the world economy has changed shape many times yet Ireland has remained an attractive destination for FDI. Our continual review and examination of how we can improve on the factors crucial to fostering investment here, including our cost base, infrastructure, the availability of talent and our legal and regulatory environment, ensure that Ireland continues to be a desirable location for FDI.
As the global investment climate continues to evolve, we will adapt accordingly – as we have done in the past – and make sure that Ireland continues to secure new FDI projects and the jobs that go with them.
46. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the steps she will take to counter the EU interpretation of the tax regime applicable to foreign direct investments here; and if she will make a statement on the matter. [49775/17]
Amharc ar fhreagraTaxation issues and related negotiations are the responsibility of the Minister for Finance and his Department. Having said that, I can confirm that Ireland’s system of corporate taxation stands up to scrutiny.
Ireland, as a founder member of the OECD, has been at the forefront of international tax reform. Ireland has been an early mover in implementing the OECD’s Base Erosion and Profit Shifting (BEPS) project and has participated fully in important reforms at EU level through the recent Anti-Tax Avoidance Directive. Ireland is a strong supporter of tax transparency and administrative cooperation, which are key to tackling the global problems of tax avoidance and aggressive tax planning.
International tax reform is complex and requires all countries to work together. The evidence shows that real reform is happening and delivering results, with an unprecedented level of consensus on a way forward and a demonstrable commitment to making it happen.
The Minister for Finance commissioned a review of Ireland’s Corporate Tax Code in Budget 2017, that report, published in September of this year, found no evidence that the Irish Corporate Tax Code provides preferential treatment to any taxpayer.
Further, in August of this year, Ireland was reviewed as part of the OECD’s “Global Forum on Transparency and Exchange of Information For Tax Purposes”, Ireland achieved a “fully compliant” rating and remains one of only 21 jurisdictions to achieve the top rating of being Compliant with all international tax transparency and exchange of information standards.
Whilst the pace of reform in International Tax is quickening, it is important to remember that from an EU perspective, tax remains a matter of Member State competence and unanimity is required before any proposals can be agreed. Ireland’s competitive tax rate of 12.5% and the transparency, reputation, certainty and consistency of our regime remain important factors in attracting FDI and these are not under threat.
It is also important to highlight that tax is only one aspect of Ireland's attractiveness for investment. Through our enterprise policies, we will continue to invest in ensuring that Ireland remains the best place to succeed in business. We will continue to place an emphasis on innovation, on creating attractive places throughout Ireland in which to work, invest and live, and on developing and attracting the talent needed for 21st century enterprise.
47. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which she has put in place, or is putting in place, measures to offset the impact of Brexit here with particular reference to exports and imports with the UK; and if she will make a statement on the matter. [49776/17]
Amharc ar fhreagraThe UK decision to exit the EU will have direct and profound impact on many key policy and operational areas across DBEI and its Agencies. In advance of the Referendum my Department conducted a contingency risk assessment of the potential impacts of Brexit across policy areas of my Department. Given that the EU’s initial negotiating position is now clear, all of Government is intensifying its focus on the economic implications of Brexit, including on domestic policy measures to reinforce the competitiveness of the Irish economy, to protect it from potential negative impacts of Brexit, and to pursue all possible opportunities (e.g. foreign direct investment) that might arise. My Department is central to the Government wide effort to prepare our economy to respond to Brexit.
On 9 November, I published “Building Stronger Business: Responding to Brexit by competing, innovating and trading”. This paper sets out work underway, and planned, by my Department and its Agencies in response to Brexit. The paper summarises the impact of Brexit across key policy areas within my Department and outlines the policy and operational measures underway and planned by my Department and its Agencies to respond to Brexit, including supports available to companies to help them prepare for Brexit, regardless of the deal that emerges from the Brexit negotiations.
Building Stronger Business also describes the research programme underway in DBEI to inform that response, as well as new structures put in place to ensure a coherent approach across the Department and its Agencies.
Enterprise Ireland has set strategic ambitions to increase client exports by €5 billion to €26 billion per annum by 2020 and to support clients in the creation of 60,000 new jobs, as well as sustaining the existing 200,000 record level of jobs. EI will achieve these ambitious objectives by:
- Increasing the levels of diversification of EI client companies into new export markets, with two thirds going beyond the UK;
- Improving the competitiveness of EI client companies through Lean programmes;
- Driving the innovation in Irish enterprise through new supports to reach a target of €1.25 billion in R&D expenditure per annum by 2020; and
- Inspiring more companies to have Global Ambition.
IDA Ireland is constantly engaged with clients across its entire portfolio and in the months leading up to the UK referendum it engaged with clients and prospective clients in relation to the potential impact of BREXIT. The IDA has a Team involved in strategic scenario planning, which continues to work on ensuring that the Agency’s strategy is fit for purpose in light of the referendum results in the UK.
IDA Ireland will:
- Continue to engage with current and prospective clients on Brexit and the potential implications of the UK’s departure from the EU for their investment decisions;
- carry out updated analysis and research on the FDI risks and opportunities associated with Brexit. This will include assessing new feedback from IDA clients on issues relating to Brexit;
- continue to hold events in key international locations, to promote Ireland as an attractive investment destination in the post-Brexit environment.
InterTrade Ireland provides a targeted portfolio of programmes to help businesses, especially SMEs, develop capacity in the areas of science, technology & innovation and sales & marketing. Given its role in promoting and supporting North- South commerce, ITI is especially well-positioned to help businesses both prepare for and address challenges that Brexit may present for cross-border trade. With that in mind, the Department has put in place two specific ITI Brexit initiatives.
- The Department funded a research project undertaken by the ESRI for InterTrade Ireland. This study provides useful data on the extent and concentration of cross-border trade, including information on this trade by product, firm types and barriers to trade.
- Additional funding was provided to ITI to undertake a range of initiatives for SMEs in the Republic of Ireland who are trading with Northern Ireland, to help them adapt to the changed circumstances following the UK’s withdrawal from the EU. In May, InterTrade Ireland utilised this funding to launch a new dedicated ‘Brexit Advisory Service’. This Service offers businesses a number of supports, including vouchers (valued at €1,000 allowing them to fund specialist advice), technical and commercial advice, information on currency hedging and an interactive information tool explaining the technical language related to Brexit.
In addition, ITI is establishing a Sectoral Advisory Panel, consisting of experts with hands-on exporting experience in specific sectors, to help ITI assess the impact of Brexit changes on particular sectors as negotiations evolve.
In terms of the research projects underway in my Department, studies are being done to enhance our understanding of the possible implications of Brexit on Ireland for enterprise, consumers and trading relations and will take account of potential changes to the conditions facing exporters and importers. These studies examine a range of scenarios and will provide an evidence base to inform Ireland’s policy positions as part of the wider negotiation on the UK’s future relationship with the EU and will help us to continue to develop further mitigation measures to respond to Brexit.
These studies include a study examining the Import Content of Irish Exports: Implications of Brexit for Inputs and Competitiveness and the extent to which Irish firms source intermediate inputs from the UK. This research will provide empirical evidence on the import content of Irish firms’ exports, how firms may be exposed to changes in the trading environment after Brexit and the impact of Brexit on inputs, and competitiveness.
In addition to these studies, the Action Plan for Jobs and Enterprise 2025 are part of a range of policy documents setting out our overall approach to enterprise policy.
Enterprise 2025 sets out a long-term ambition and strategy to encourage and facilitate enterprise growth and job creation. This document addresses the broader enterprise environment and also sets out the rationale for a range of enterprise supports. As part of DBEI’s overall response to Brexit, a review of Enterprise 2025 is currently underway to determine the extent to which the policy framework and priorities set out in Enterprise 2025 remain robust in light of recent significant and potentially disruptive changes in the global environment, with a particular focus on Brexit.
The Action Plan for Jobs has been an essential tool from a competitiveness perspective and has been successful in driving coordinated actions to improve job creation, broaden the export and enterprise base, and enhance competitiveness. APJ 2018 will provide a platform to develop and implement immediate, short terms actions to support enterprise and address the challenges which firms are already facing as a result of the UK’s decision to exit the EU.
Budget 2018 contained some important pro-business measures to help companies compete in the face of Brexit including:
- New €300 million Brexit Loan Scheme for Business;
- Doubling of additional DBEI Brexit related agency staff to 100;
- New €25m Regional Fund Competitive Call from Enterprise Ireland;
- Tax package to support Enterprise and investment to attract jobs to Regions;
- Investment in PhD & Research Masters Programme to meet enterprise skills needs;
- SFI Research Centres to increase from 12 to 17 with new Capital funding; and
- Ireland to become a member of European Southern Observatory in 2018.
I also secured an additional €3 million in current funding in both 2017 and 2018 to recruit up to 100 additional staff, specifically to assist in the response to the evolving Brexit situation. As well as supporting Brexit-related staffing within my Department, these resources have been distributed across Enterprise Ireland, IDA Ireland, Science Foundation Ireland and the Health and Safety Authority. These additional resources will be assigned to both overseas offices in markets that are growing and have scale and markets where we are already well-established but with potential for further growth. Irish based posts will address a range of Brexit issues, including the support for internationalisation activities, a strengthening of the LEOs ability to respond locally to help micro-enterprises, and enhanced support for innovation.
It is essential that Government supports are definitively targeted at vulnerable, but viable companies. My Department is developing specific supports for companies to mitigate these impacts. In response, working in partnership with the Department of Agriculture, Food and the Marine, DBEI has secured Budget funding for a Brexit Loan Scheme which aims to make up to €300 million available to businesses with up to 499 employees at a proposed interest rate of 4 per cent. The scheme is open both to State Agency clients and those businesses that do not have any relationship with State Agencies. The finance will be easier to access, more competitively priced, and at more favourable terms than current offerings.
Additional measures compatible with the EU State Aid framework are also under active consideration:
- A longer-term investment loan guarantee scheme which would focus on Business Development to allow SMEs to invest for a post-Brexit environment and to address potential disruption that might arise (i.e. new market entry and development costs, trade facilitation requirements, new trading arrangements and possible tariffs, transport costs and trans-shipment costs, changes to regulations and standards and border controls and certification). It is intended that the Scheme will operate under the State Aid General Block Exemption Regulation.
- A rescue and restructure scheme was pre-notified to the Commission at the end of August. It is envisaged that this scheme would apply to all SMEs in the manufacturing or internationally traded services sectors, as well as to the fisheries and aquaculture sector, and SMEs engaged in processing and marketing in the agricultural sector.
In addition to these measures, it is proposed that a Business Advisory Hub be established which would focus on business development to allow enterprises to position them for a post-Brexit environment. This would build on the existing supports available and on work being undertaken by Enterprise Ireland, the Local Enterprise Offices and the Credit Review Office.
48. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which she has identified the sectors most likely to be negatively impacted by Brexit; the steps taken to alleviate such an impact; and if she will make a statement on the matter. [49777/17]
Amharc ar fhreagraMy Department and its enterprise agencies are focused on assisting companies to prepare for the UK's withdrawal from the EU. This includes efforts to build awareness of sector-specific challenges that Brexit is likely to pose.
Much of our broader work so far to help mitigate the impact of Brexit on Irish firms is captured in my Department's recently published response paper to the UK's impending exit from the EU, entitled "Building Stronger Business - Responding to Brexit by Competing, Innovating and Trading". This paper summarises the policy measures already taken, outlines future initiatives we intend to take forward and details the steps the Department has taken already to ensure that we can work as efficiently as possible to support our companies.
To inform policy, develop effective mitigation strategies and help prepare Ireland’s position on our trade priorities, DBEI had already published a number of reports and is currently engaged in a suite of studies. A significant amount of this analysis is undertaken at sectoral level.
Completed research includes the outputs from a series of structured engagements with companies (of different sizes, across different sectors and across the regions) and from a survey of a thousand SME business owners to "Understand the Implications of Brexit for Irish SME’s" which my Department published earlier this year. Additionally, a study analysing the "Potential Impact of WTO Tariffs on Cross-Border Trade" was published by InterTrade Ireland in conjunction with my Department in June. This study provides an understanding of the impact of different trade and tariff regimes which might be imposed following Brexit and includes a sectoral focus.
In terms of ongoing research commitments, the Department is currently working on:
- A major study examining the "Strategic Implications arising from EU-UK Trading Patterns". This study will provide an evidence base on key trade and investment questions to inform Ireland’s position as part of the wider negotiation on the UK’s future relationship with the EU. It will quantify the possible impact of a range of Brexit scenarios on trade and investment. The study will provide in-depth analysis of key sectors. It will decompose the potential trade and investment impacts for key sectors and in each scenario identify which elements contribute to the results (i.e. tariffs, non-tariff barriers, transit costs, other trade costs), leading to sector-by-sector understanding of solutions.
- A study examining the "Sectoral implications arising from Brexit" focused on 18 sectors most exposed to the UK is underway and is due to be completed by end 2017. This research examines the implications at firm-level for Ireland’s most exposed enterprise sectors of the UK being outside of the European Single Market and Customs Union. The study is expected to be completed by end 2017.
- A study examining the "Import Content of Irish Exports: Implications of Brexit for Inputs and Competitiveness" and the extent to which Irish firms source intermediate inputs from the UK has just commenced. This research will provide empirical evidence on the import content of Irish firms’ exports, how firms & sectors may be exposed to changes in the trading environment after Brexit and the impact of Brexit on inputs, and competitiveness.
- A study examining the "Skills needs arising from the Potential Trading and Regulatory Implications of Brexit" has commenced – with a particular focus on sectors such as logistics and freight. This research is being undertaken in my Department on behalf of the Expert Group on Future Skills Needs.
The outcomes of this research will inform policy decisions relating to the immediate support for enterprise, developing effective mitigation actions and preparing our longer term desired outcomes from the negotiations.
Our State Agencies are already very active in taking forward projects aimed at helping businesses in Ireland prepare for the post-Brexit commercial environment.
Enterprise Ireland and the LEOs are steadily working with companies to make sure that they are better prepared to respond to the challenges that Brexit will bring. These are the medium term, strategic actions that I know that companies are calling for – things like helping them to drive down costs, diversify into new markets and innovate in the way they do business.
Enterprise Ireland has been systematically engaging with its 1,500 clients that export to the UK and is providing information and guidance, market diversification support and competitiveness and market development support to help companies prepare for the future trading relationship with the UK.
Enterprise Ireland launched the 'Prepare for Brexit' campaign, which features the SME Scorecard tool. The Scorecard is an interactive online platform which can be used by all companies to self-assess their exposure to Brexit and areas they may need to consider preparing further on in the context of Brexit. EI has also introduced a ‘Be Prepared Grant’ which offers up to €5,000 in funding to support exporting client companies develop a Brexit Action Plan. The 'Prepare for Brexit' campaign aims to encourage more SMEs to prepare for Brexit and start putting in place detailed plans to mitigate risks and leverage opportunities that may arise, now that Brexit negotiations have begun. Additionally, InterTrade Ireland, has introduced a scheme to help SMEs avail of expert advice on Brexit.
While progress is being made in helping sectors to prepare, we know much more work remains to be done. That is why we will remain absolutely focused on our Brexit-related initiatives and will continue to explore new avenues and means of helping our companies plan for the future.
49. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the degree to which innovation remains an integral part of this country’s campaign to maximise its industrial impact in terms of effective trading, efficiency and modernisation with particular reference to competing on EU and world markets; and if she will make a statement on the matter. [49778/17]
Amharc ar fhreagraA key objective for Ireland is to deliver growth that is sustainable, led by strong export performance and underpinned by innovation, productivity and competitiveness. As the Government continues to place innovation at the heart of enterprise and jobs policies, my Department has developed Innovation 2020, Ireland’s strategy for research and development, science and technology, and Enterprise 2025, Ireland’s enterprise policy, side by side. As set out in Innovation 2020, Ireland’s ambition is to become Global Innovation Leader, driving a strong sustainable economy, underpinned by a strong innovative and internationally competitive enterprise base, growing employment, sales and exports. Recognising that innovation must be at the core of stimulating growth, sustainability and company resilience, the strategy sets out actions to increase enterprise engagement in innovation to assist companies in developing new, higher value-added products and services, and more efficient processes.
Enterprise 2025 sets a roadmap for long-term enterprise development and resilience, with the ambition to achieve a step-change in the performance of our enterprises, to build a real and distinctive competitive edge sector-by-sector and to excel in creating a jobs-fit environment with top-three competitiveness ranking. Enterprise 2025 is currently being reviewed to ensure that our policy framework and priorities are robust and remain current. This review is being undertaken in the context of global changes that are likely to have an immediate impact on Ireland's enterprise development, and specifically Brexit and potential policy changes under the new US administration.
In March of this year, the Government published a new Trade Strategy, Ireland Connected: Trading and Investing in a Dynamic World, a whole of government commitment to our openness to trade, to strengthening our international relationships and to deepening our enterprise resilience. The strategy sets out a suite of actions that will enable us to respond to structural change and to realise growth that is sustainable over the longer term. The strategy recognises that our strategic investment in innovation contributes to an environment that allows the benefits of open trade to materialise in Ireland.
Supporting innovation in companies to diversify their exports while also growing exports in existing markets has been a central pillar of Enterprise Ireland strategy for over a decade. Enterprise Ireland’s 2017-2020 ‘Build Scale and Expand Reach’ Strategy and its new Eurozone Strategy to assist Irish exporters increase exports in Eurozone countries by 50% by 2020 is a medium-term strategy particularly aimed at strengthening clients export offer and finding new export opportunities.
50. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which new trade deals have been entered into following recent promotional tours by herself and bodies under the aegis of her Department; and if she will make a statement on the matter. [49779/17]
Amharc ar fhreagraTrade Missions bring Irish businesses into direct contact with business opportunities abroad. Such missions have proven to be valuable supports to Irish businesses in terms of establishing their credibility with and gaining access to the business community in the target market at the appropriate level. This is particularly the case in countries where government-to-government contacts are a prerequisite for doing business. These trade missions are an integral part of the work of relevant Government Departments and Agencies to develop and expand Ireland’s exports to existing and new markets abroad. They raise Ireland’s profile as a world–class supplier of goods and tradable services and contribute to the generation of incremental sales to foreign markets over the long-term and they are the culmination of the success of our enterprise development policies on the ground.
The trade deals which are referred to by the Deputy in this question are being interpreted as being business agreements and announcements by companies that have participated in Trade Missions which I have led in my time as Minister for Business, Enterprise and Innovation.
Since June I have participated in four Trade Missions and events with Enterprise Ireland. Across these events, I have witnessed:
- Enterprise Ireland clients, such as Combilift, sign agreements with foreign companies that will see them launch new products in international markets.
- The launch of patented technology, such as, Novaerus first patented technology for airborne infections.
- The deployment of Irish technology in international markets, such as C & F Green Energy proprietary wind turbine technology deployment in Japan.
- The opening of an international office for Kingspan.
- The announcement of 14 new deals and achievements in the Australian market by Enterprise Ireland clients.
51. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which she expects innovation to continue to become a primary issue in the course of trade discussions, negotiations and investment in the indigenous and the foreign direct investment sector here in terms of cost benefit; and if she will make a statement on the matter. [49780/17]
Amharc ar fhreagraWith a small domestic market, further expansion in other markets is essential to Ireland’s continued economic growth. Overall, export growth in Ireland in recent years has been exceptionally strong and exports continue to contribute positively to growth and employment. The EU’s suite of Free Trade Agreements with third Countries helps to open new markets, break down barriers and provide new opportunities for Irish firms.
The European Commission acts as lead negotiator on behalf of the EU Member States in Trade negotiations. The EU’s suite of Free Trade Agreements coupled with our programme of trade and investment missions have provided a key foundation on which to further build our strong economic and trading links in export markets and these will continue into the future.
Opening up the EU economy to trade and investment is a major source of productivity gains and private investment. They bring ideas and innovation, new technologies and the best research. They benefit consumers, lowering prices and broadening choice. Providing greater choice of inputs directly contributes to the competitiveness of Irish companies at home and abroad. Businesses which act upon the opportunities and possibilities for change through innovation successfully compete and even flourish in the face of the range of emerging adverse and fluctuating business and economic conditions. In this regard, Ireland will continue to support the EU’s ambitious programme of negotiating new or updated Free Trade Agreements giving Irish Firms expanded market access and a predictable trading environment in third countries.
52. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the steps she is taking to encourage an even distribution of job creating investment throughout the regions with particular reference to the need to encourage and ensure industrial development everywhere on par with the greater Dublin region; and if she will make a statement on the matter. [49781/17]
Amharc ar fhreagra53. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which she has promoted, supported and-or grant aided job creating investment throughout the regions in 2016; her plans in this regard in the future; and if she will make a statement on the matter. [49782/17]
Amharc ar fhreagraI propose to take Questions Nos. 52 and 53 together.
The Regional Action Plan for Jobs initiative is a central pillar of the Government’s ambition to create 200,000 new jobs by 2020, 135,000 of which are outside of Dublin. Progress on this initiative to date is good and employment continues to grow. In the year to Q2 2017, 48,100 jobs were created across the country; four out of five of these jobs were outside Dublin.
The Enterprise Agencies continue to work to contribute to employment and economic growth throughout all regions. In 2016, almost two thirds of new jobs created by Enterprise Ireland supported companies, and over half of those created by IDA supported companies, were outside Dublin. The 2016 Local Enterprise Office (LEO) annual jobs survey results highlighted three consecutive years of local jobs growth in small and micro-businesses throughout the country: in 2016 there was a net increase of 3,679 jobs and total direct employment among LEO client companies stood at 34,634.
Total payments from IDA, EI, and the LEOs to clients are broken down by region in the table. The table shows that in 2016, 78% of all IDA payments, 81% of all LEO payments, and 65% of all EI payments were granted to companies and projects outside Dublin.
Enterprise Agency payments 2016
|
IDA |
EI |
LEOs |
|
|
Mid East |
€ 3,732,916 |
€ 9,461,635 |
€ 740,024 |
|
Midlands |
€ 2,298,769 |
€ 4,348,347 |
€ 1,116,672 |
|
Border |
€ 5,258,350 |
€ 15,583,545 |
€ 1,728,618 |
|
Mid West (includes all Tipperary) |
€ 19,193,141 |
€ 6,777,258 |
€ 1,808,979 |
|
West |
€ 15,109,411 |
€ 6,914,242 |
€ 935,966 |
|
South West |
€ 14,245,739 |
€ 15,653,293 |
€ 1,618,654 |
|
South East (excludes Tipperary) |
€ 13,003,019 |
€ 5,510,367 |
€ 1,288,775 |
|
Dublin |
€ 20,136,706 * |
€ 35,096,028 |
€ 2,179,741 |
|
Total |
€ 92,978,051 |
€ 99,344,715 |
€ 11,417,429 |
*includes payments to the National Institute for Bioprocess Research and Training (NIBRT).
Enterprise Ireland’s strategy for 2017-2020 aims to create a further 60,000 jobs, while sustaining existing ones, which will make an important contribution to jobs and economic growth across all regions; IDA meanwhile will continue to target a minimum increase in investment of 30% to 40% in each region outside Dublin to 2019. The 31 LEOs will continue to support local economies by acting as the ‘first-stop-shop’ State support service for micro and small businesses in each local area. The LEOs are providing advice and direction, covering all government supports and requirements, to anyone who wishes to start or expand a business.
To further support enterprise development across all regions, additional funding of up to €60m is being rolled out by Enterprise Ireland over the next 4 years to support the development and implementation of collaborative and innovative projects that can sustain and add to employment at a national, regional and county level. This regional competitive fund will support the ambition, goals and implementation of the Regional Action Plans for Jobs.
Additional funding of €150m is also being made available to the IDA to support its Regional Property Programme and drive job creation in the multi-national sector.
54. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the number of jobs created in 2016 in the indigenous sector; the number of such jobs created through foreign direct investment in the same period; and if she will make a statement on the matter. [49783/17]
Amharc ar fhreagraEnterprise Ireland has responsibility for the development of Irish enterprise, deepening Ireland’s footprint in world markets, and supporting employment creation in our economy. Enterprise Ireland supports companies in every region of Ireland to start and scale, innovate and remain competitive on international markets. Enterprise Ireland is working with client companies through a network of market and sector advisers from 10 offices located throughout the country and 33 international offices across the globe.
In 2016, Enterprise Ireland supported companies employed 201,108 people. In that year, 19,244 new jobs were created resulting in a net gain of 9,117 jobs across the country. Enterprise Ireland supported companies sustain over 375,000 direct and indirect jobs nationwide.
The 31 Local Enterprise Offices (LEOs) are located throughout the country and provide a range of supports for the micro and small business sector. They provide the “first-stop-shop” for providing advice and guidance, financial assistance and other supports to those wishing to start or grow their own business.
In 2016, a total of 7,883 new jobs were created by companies supported by the LEOs resulting in a net gain of 3,679 jobs.
Ireland's inward investment promotion agency, the IDA, partners with potential and existing investors to help them establish or expand their operations in Ireland. Its main objective is to encourage investment into Ireland by foreign-owned companies.
IDA client companies created 18,627 jobs on the ground during 2016 across a range of sectors, with every region of Ireland posting net gains in jobs. The strong net job creation performance of 11,842 additional jobs in Ireland is a result of a very strong pipeline of new investments and lower job losses within the employment portfolio. Losses as a percentage of the overall employment portfolio were at their lowest level in 19 years (1997).
Total employment at Enterprise Ireland overseas companies now stands at 199,877 people, the highest level on record.
55. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which technology, education and the availability of suitable business and housing accommodation continue to be an issue in regard to the creation of further employment throughout the entire country; and if she will make a statement on the matter. [49784/17]
Amharc ar fhreagraDespite intense competition, the trajectory of Ireland’s competitiveness performance is positive. Our improved performance is reflected in strong employment growth across sectors and regions. The strong performance of clients supported by the enterprise agencies in winning exports, market share and job creation in the face of intense global competition is to be commended and reflects the competitiveness of the environment in which to do business in Ireland.
Global uncertainty and Brexit have underlined the importance of building competitive advantage.
As Minister for Business, Enterprise and Innovation, my objective is to create the best possible environment for enterprise, entrepreneurship, innovation and investment across all regions which will increase our competitiveness and support job creation. We are taking steps to ensure the economy is resilient at sectoral and firm level to deal with imminent competitiveness challenges and to build further on the progress we have made. The Government is increasing investing in infrastructure, innovation and talent and enhancing our education and training system.
From an enterprise competitiveness perspective, the ability of those coming out of the education and training system to meet the needs of a competitive economy is critical. As measured by to the IMD’s 2017 Global Competitiveness Report, Ireland performs relatively well in an international context. In terms of whether the education system and university education meets the needs of a competitive economy, Ireland is ranked and 8th and 5th in the world respectively in the IMD's report. Ireland is ranked 1st in perceptions regarding attracting and retaining talent being a priority for firms. Ireland is ranked 10th with regard to management education meeting the needs of the business community.
From a competitiveness perspective, the affordability of housing and rent levels impact upon the attractiveness of Ireland as a location for investment and indirectly impacts on enterprise costs. It is well recognised that an expansion in the supply of housing is urgently required, particularly in Dublin. The Action Plan for Housing 'Rebuilding Ireland' sets out a range of actions to boost supply and sustainably address rental affordability of all types of housing, particularly for persons most at risk of housing and rental market exclusion. Economic growth and enterprise expansion has contributed to strong demand for commercial office space in Dublin and other urban locations.
Given the rise in both commercial property rents and capital values, I welcome the recent partnerships the Irish Strategic Investment Fund have entered with various property funds to increase the supply of commercial property solutions in Ireland.
The immediate challenge for Ireland is to ensure growth is sustainable, enterprises are resilient and our economy is internationally competitive. Improving competitiveness will remain the key to supporting employment growth. I will shortly bring the Competitiveness Council's annual Competitiveness Challenge report to Government and I will ensure the required actions to address emerging competitiveness issues across Government are addressed as part of the Action Plan for Jobs process.
56. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the number of small job creating enterprises set up in the past 12 months; the number of jobs involved; the degree to which this programme can continue; and if she will make a statement on the matter. [49785/17]
Amharc ar fhreagraEnterprise Ireland is the state agency with responsibility for the development and growth of Irish enterprises in world markets. Enterprise Ireland works in partnership with Irish enterprises to help them start, innovate, scale and win export sales in global markets. In this way, Enterprise Ireland supports sustainable economic growth, regional development and secure employment.
A key focus of Enterprise Ireland’s activity is supporting start-ups and the start-up ecosystem, as illustrated by the following EI programmes and service level agreements:
- National Entrepreneurial Development Programme
- Competitive Start Fund
- High Potential Start Ups equity support
- Regional Accelerator Scheme 2015 -2017
- Campus Incubator Scheme
- Seed and Venture Capital Scheme 2013-2018
- Service Level Agreement in place with the BICs (Business Incubation Centres)
- Service Level Agreement in place with Local Enterprise Offices to support micro-enterprise.
Enterprise Ireland provides financial and non-financial support for start-up businesses, with the potential to develop an innovative product or service for sale in international markets and the potential to create 10 jobs and €1m in sales within 3 to 4 years of starting up. This cohort of companies is referred to as High Potential Start-Ups. In 2016 Enterprise Ireland supported 101 new High Potential Start-Ups, of this:
- 48% were formed outside Dublin
- 19 HPSUs were led by female entrepreneurs; and
- 16 HPSUs were led by overseas entrepreneurs.
The High Potential Start-Ups Class of 2016 has supported approximately 180 jobs to date. The High Potential Start-Ups Class of 2015 and 2016 collectively employ approximately 700 people.
In addition, there are 31 Local Enterprise Offices (LEOs) located throughout the country that provide a range of supports for the micro and small business sector. As the “first-stop-shop” for providing advice and guidance, financial assistance and other supports to those wishing to start or grow their own business, the LEOs:
- provide a sign-posting service to all relevant State supports.
- offer direct grant aid to micro-enterprises (10 employees or fewer) in the manufacturing and internationally traded services sector which, over time, have the potential to develop into strong export entities.
- offer “soft” supports in the form of training and mentoring; and
- assist with loan applications to Micro Finance Ireland.
A capital allocation of €15 million was made available to the LEOs in 2016 to fund investment in their clients by way of grants and a range of “soft” supports, such as training and mentoring.
In 2016, the LEOs provided priming grant assistance to 357 clients towards the cost of setting up new businesses. It is estimated that these projects have the potential to result in the creation of circa 1,150 jobs over the coming years.
57. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which she remains satisfied that this country continues to be an active location for indigenous and foreign direct investment; the extent to which competition in the market place is evident in this area; and if she will make a statement on the matter. [49786/17]
Amharc ar fhreagraThis Government is committed to maintaining Ireland’s competitive edge. That is why we introduced a pro-business Budget with record levels of multi-annual funding and tax measures which will allow businesses across Ireland to develop, scale, innovate and embed.
My Department recognises the importance of Ireland remaining an active location for indigenous and foreign direct investment. Enterprise Ireland is the state agency that has responsibility for the development of Irish enterprise, deepening Ireland’s footprint in world markets, and supporting employment creation in our economy. Supporting Irish businesses in the manufacturing and internationally traded service sectors and also FDI food companies located in Ireland, Enterprise Ireland supports companies in every region of Ireland to start and scale, innovate and remain competitive on international markets.
Enterprise Ireland is working with client companies through a network of market and sector advisers from 10 offices located throughout the country and 33 international offices across the globe. At the centre of the agency’s strategy, Build Scale, Expand Reach 2017 – 2020, are strategic targets focused on:
- Assisting clients to create 60,000 new jobs by 2020 while sustaining the existing record level of jobs;
- Growing the annual exports of client companies by €5bn to €26bn per annum;
- Increasing the level of spend made by client companies in the Irish economy by €4bn to €27bn per annum by 2020; and
- Inspiring more Irish owned companies to have global ambition.
The 5,000 manufacturing and internationally traded services companies that Enterprise Ireland works with are a critical source of existing employment and job creation in every county in Ireland. Enterprise Ireland’s 2016 activity highlights presented below clearly show how Ireland is an active location for indigenous and foreign direct investment.
- Enterprise Ireland supported companies employed 201,108 people. In 2016 19,244 new jobs were created resulting in a net gain of 9,117 jobs across the country.
- Enterprise Ireland clients recorded exports of €21.6 billion, up 6 per cent on 2015 export figures, with all sectors reporting growth.
- In 2016, Enterprise Ireland supported the establishment of 229 new internationally focused start-ups (including 101 High Potential Start-Ups) across a range of sectors which will create over 1,500 jobs over the next three years.
- Supporting market-led innovation, Enterprise Ireland approved 78 R&D investments of over €100k to client companies. 950 client companies were engaged in R&D projects with an annual spend of over €100k. A top tier of 140 clients were engaged in R&D projects with an investment of over €1 per annum
- Enterprise Ireland’s equity and venture capital investment was €85 million in 2016.
IDA Ireland’s main objective is to encourage investment into Ireland by foreign-owned companies, and their success is measured by the impact on the Irish economy of FDI and IDA supported companies. From an IDA perspective, our overall FDI offering which despite an increasingly competitive global environment, remains very attractive to overseas companies.
Multinational companies invest in Ireland for many reasons, not just one. Ireland has a strong pool of highly skilled workers and a first-class education system that produces top-level graduates. Our country benefits as well from favourable demographics – over 40% of our population is under 29, making ours the youngest in the EU. Our membership of the EU is another key selling point. When companies establish operations here, they immediately benefit from barrier-free access to an EU market of over 500 million consumers.
Ireland is simply a great place to do business: we offer strong incentives for research and development, a rich talent pool and a stable and competitive corporation tax regime.
IDA Ireland had a record year in 2016 and total employment at overseas companies now stands at 199,877 people, the highest level on record.
IDA client companies created 18,627 jobs (11,842 Net New Jobs) on the ground during the year across a range of sectors, with every region of Ireland posting net gains in jobs. The latest results indicating a strong performance by the organisation towards delivering its 2019 target of 80,000 new jobs and 900 investments.
IDA Ireland’s strategy for 2015-2019 includes a commitment to increase foreign FDI in every region outside Dublin by 30%-40%. The Agency made good progress towards achieving this goal in 2016, with 52% of all jobs created by IDA Ireland's clients last year based outside of Dublin.
58. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which the knowledge development box continues to be an asset in securing investment in jobs here; and if she will make a statement on the matter. [49787/17]
Amharc ar fhreagraIreland was the first country world-wide to introduce an OECD compliant Knowledge Development Box (KDB) offering. The certainty, predictability and clear signal that this has sent to enterprise – including both Irish owned and foreign owned entities establishing and doing business from here - remains essential. This certainty has become even more important in the current dynamic and uncertain geopolitical landscape.
The KDB, introduced in Budget 2016 forms part of Ireland’s competitive offering to continue to attract foreign direct investment (FDI) and to support Irish owned companies to innovate and to compete effectively on international markets. The continuing imperative to establish Ireland as the best place in which to succeed in business is reinforced in our national Enterprise and Innovation strategies. Our aim is that Ireland will be recognised as the place where businesses are innovative, competitive and productive – leading to growth that is sustainable and results in employment opportunities and a higher standard of living for all. These strategies set out the framework for investment over the coming decade to ensure that Ireland remains equally attractive to foreign direct investment and to Irish entrepreneurs and growth businesses in the context of an intensely competitive international environment.
The Knowledge Development Box provides an effective 6.25% rate of corporation tax on profits from certain qualifying assets that are earned by a company, chargeable to corporation tax in the State, to the extent that the assets relate to R&D undertaken by that company. Ireland’s KDB effective rate is internationally competitive.
The KDB complements the existing suite of initiatives and supports available to companies that undertake R&D activities in Ireland across the lifecycle of research and development – including R&D tax credits, RD&I grant supports, support for technology acquisition (S291A), significant state investments in National Research Centres and knowledge transfer infrastructures, and advisory supports for accessing Horizon 2020 funding – providing a competitive proposition for business investment.
As a key part of Ireland's competitive offering as a location of choice from which to do business, the KDB has helped secure investment since its introduction in 2016. It will continue to form part of Ireland's proposition and stimulate further investment in R&D activities by both Irish and foreign owned enterprises - ultimately delivering jobs and economic substance in Ireland.
59. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which she continues to engage with investment and job creation interests in Northern Ireland with a view to maintaining the best possible relationship of a mutually beneficial nature with Northern Ireland and the EU in the aftermath of Brexit; and if she will make a statement on the matter. [49788/17]
Amharc ar fhreagra60. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which she continues to engage with investment and job creation interests in Northern Ireland with a view to maintaining the best possible relationship of a mutually beneficial nature with Northern Ireland and the EU in the aftermath of Brexit; and if she will make a statement on the matter. [49789/17]
Amharc ar fhreagraI propose to take Questions Nos. 59 and 60 together.
My Department works closely with its counterpart in Northern Ireland - the Department for the Economy - in connection with the operation of InterTrade Ireland (ITI), the cross-border body that assists SMEs all across the island in growing North-South trade. ITI also helps its client companies to become more competitive and investor ready by developing new products and services.
A key part of ITI's recent work has been assisting businesses, both North and South, prepare for the challenges that Brexit will present. This includes the provision of expert advice on technical issues associated with the UK's withdrawal from the European Union. The objective of this programme of work is ensuring that companies all over Ireland are as best equipped as possible to operate in the post-Brexit commercial environment.
In relation to maintaining mutually beneficial relationships on enterprise development and trade, the Government's position on preferred future arrangements following Brexit has been made very clear. We continue to work towards an outcome that will maintain the closest and most positive possible trading relationship between the UK and Ireland.
61. Deputy Bernard J. Durkan asked the Tánaiste and Minister for Business, Enterprise and Innovation the extent to which this jurisdiction remains competitive and attractive for jobs in both the manufacturing and services sectors; and if she will make a statement on the matter. [49790/17]
Amharc ar fhreagraImproving Ireland’s international competitiveness is a key economic priority for Government. Since 2012, the Government’s Action Plan for Jobs has set out a comprehensive set of measures to improve our competitiveness performance. Ireland’s improving competitiveness performance over the period 2011-2016 has been central to the recovery in employment and economic growth. Ireland’s relative international competitiveness as measured by a range of international indices has improved. Ireland moved from 16th to 6th in 2017 in the IMD’s World Competitiveness Yearbook. In addition, the World Bank’s most recent “Doing Business 2018” report shows Ireland is now ranked 17th out of 190 countries, an improvement of 1 place on last year.
Our improved performance is reflected in strong employment growth across sectors and regions. The most recent Quarterly National Household Survey data from the CSO shows there was an annual increase in employment of 2.4% or 48,100 in the year to the second quarter of 2017, bringing total employment to 2,063,000. Employment increased in eleven of the fourteen economic sectors over the year. CSO data shows that since 2012, the numbers employed in Industry have increased by 12% to 260,100 with the numbers employed in the Services sector increasing by 8.6% to 1,539,000 persons employed. This increase in employment growth is testament to the competitiveness of Irish enterprise.
However, there is no room for complacency. We need to continue to improve the environment for doing business in Ireland and remain vigilant to the very significant challenges in the external environment, particularly, Brexit. The challenges posed by Brexit provide urgent impetus to pursue policies that enhance competitiveness. I agree with the assessment of the National Competitiveness Council that we need to improve structural factors such as innovation capacity, the quality of infrastructure, costs of doing business and productivity across all economic sectors. The Government is working to reduce the administrative burden that regulations create can improve the business environment by reducing costs, minimising the time businesses spend fulfilling regulatory requirements and increasing productivity. Ensuring that the State does not place undue administrative burdens and costs on entrepreneurs and business owners is critical to competitiveness, productivity and job creation.
The immediate challenge for Ireland is to ensure growth is sustainable, enterprises are resilient and as a small open economy Ireland is best positioned to withstand shifts in economic fortunes. My objective is to ensure the economy is resilient at sectoral and firm level to deal with imminent competitiveness challenges and to build further on the progress we have made. As set out in Budget 2018 my Department is intensifying its focus on the economic implications of Brexit, including on domestic policy measures to reinforce the competitiveness of the Irish economy, to protect it from potential negative impacts of Brexit, and to pursue all possible opportunities that might arise.
I will shortly bring the Competitiveness Council's annual Competitiveness Challenge report to Government and we will ensure the required actions to address emerging issues are addressed as part of the Action Plan for Jobs process.
