Minister defends strategy to attract firms to Ireland post-Brexit

Minister of State Eoghan Murphy has defended the Government's efforts to attract companies to Ireland post-Brexit amid reports that Germany is leading the way in luring London-based finance activity to Frankfurt and other German cities.

Speaking on the fringes of a meeting of euro zone finance ministers in Luxembourg, the Minister of State for Finance said he expected at least two announcements by the end of this year from companies intending to expand in Ireland, with further announcements in the pipeline for next year.

“We are definitely up there as a location of choice we think for a lot of the potential movers. We have put a huge amount of work into this. We’re just taking a different strategy to some of the other countries.”

Noting that some countries were publicising their efforts in the media, he said Ireland was taking “a more subtle approach but no less a committed approach to make sure we are connecting into all the relevant financial centres, to make sure people are aware of the offering, why it’s strong already, but why it will improve post-Brexit. We have been targeting specific companies as well.”

While declining to name specific businesses, sources in the financial industry believe it is most likely that companies that already have banking licenses in Ireland will be most likely to bolster their presence in Dublin in the wake of Britain’s decision to leave the EU.

Strengths

Mr Murphy said Ireland had particular strengths in the areas of fund administration and management, insurance and reinsurance, investment banking and increasingly in the field of fintech and payments.

There are growing fears in the City of London that the British government may sacrifice access to Europe’s Single Market in forthcoming negotiations on Brexit amid indications from prime minister Theresa May that the government was favouring a “hard Brexit”.

This could affect the City’s ability to “passport’”services into the EU, while there are also concerns about Britain’s right to clear euro-denominated derivatives once the country leaves the EU.

Mr Murphy, who is due to meet with senior figures in the finance industry next month in London, said he expected most companies to make decisions about relocation within six months of article 50 being triggered. “They won’t be able to wait for the end of the process because it will go on for two years. Companies can’t wait to make decisions that long.”

Representations

On Monday the

Financial Times

reported that Frankfurt has been pitching for business in London in recent weeks, with Germany considering changing its labour laws to make Germany a more attractive financial services location after Brexit.

France, Luxembourg and Spain had also made representations in London in recent weeks, the paper said.

Mr Murphy cited the increased level of commercial property development in Dublin as a particular selling point for Ireland in terms of attracting investment.

“If you look at commercial development that is going on, a lot of that is going to become available later next year. Five million square feet is under construction, while another five million square feet is in the planning. It means we’ll be in a good position to take advantage of whatever may come our way.”

While the Minister confirmed there would be specific “Brexit” measures announced in Tuesday’s budget, the challenge for Irish businesses and exporters was much broader.

“It’s bigger than just targeted measures for exporting companies, or specific programmes. If there’s going to be a slowdown in growth in the UK then there is going to be a resultant impact in Ireland.”

He said diversification was important for Irish exporters.