How to woo a multinational
Dundalk attracted four major job investments by foreign companies in two years, according to new figures. What was it doing right?
Every town wants a PayPal. Last year Dundalk won the equivalent of an employment lottery when PayPal, the ecommerce payment system, announced it was bringing 1,000 jobs to the Co Louth town. Last year the inward-investment agency IDA Ireland generated 6,570 jobs in the State, with the help of foreign direct investment (FDI). Of those FDI jobs, Dundalk got 1,326, spread across four companies.
Dublin, Cork and Galway cities also did very well. By comparison, rural Ireland did not. So how does an Irish town attract foreign investment? What does a successful bid mean to a town? And what role does the IDA play in helping to focus international attention on various parts of the State?
Paddy Malone, president of Dundalk Chamber of Commerce, says: “For the previous 30 years, Dundalk had nothing.” He adds that during the Troubles, the town was controversially known as “El Paso”.
“We haven’t seen the impact of the job creation yet, because we lost a lot of jobs when Vodafone pulled out, but we will,” he says. Malone says the chamber is sometimes aware when potential foreign investors are coming on a visit, and help the IDA with local information, such as availability of housing.
“There is a huge benefit to a cluster effect,” he says. “PayPal coming here is a prime example of that.”
In the cases of towns or communities that don’t yet have many businesses of significant size, Malone suggests that “if 100 people set up companies of 10 people each, then they’d have a cluster effect. You have to sell the advantages you have.
“Not every town can get a PayPal. The company will make the decisions about where they want to go, and no amount of wishing they’ll go to Monaghan or Leitrim will bring the jobs there.”
For months there were rumours that PayPal would locate in Limerick or Dundalk. Can the IDA nudge a company towards a location where unemployment is particularly high?
“The most important thing is for Ireland to win the jobs,” says Barry O’Leary, chief executive of IDA Ireland. “We try and get a spread around the country, but that has proved to be a very, very difficult challenge. We’re not just competing within Ireland; we’re often up against other big cities – say Manchester, Barcelona, Prague.”
The IDA focuses on attracting investors in specific sectors: information and communications, digital media, technology, pharmaceutical and medical devices, and financial services, among others. They work with potential investors in advance of any visit to Ireland, usually meeting them in their home country first.
“From the minute they land to the minute they depart, we’re with them,” he says. “We put together a programme, bring them to locations, view potential buildings, visit competing companies, meet with legal firms, tax firms, recruitment companies.”
He says that our level of corporation tax is “an important part of decision-making, but we would never win business just on that”. Top of the list of the qualities companies are looking for is “a talent pool. And what sort of track record the area has. Are there research institutions nearby? Have they invested in other businesses?”
There are also a number of practical issues, especially for those who may be thinking of investing in a pharmaceutical plant. “Those people would need a site of at least 100 acres, two million gallons of water a day, and plenty of power. Not every location can deliver that.”