Ireland leads foreign investors league

SUZANNE LYNCH

IRELAND HAS been named the top destination in the world for foreign direct investment in terms of the value of the projects and investment it attracts, according to the 2011 IBM Global Location Trends report.

Ireland is followed by South Korea, Taiwan, Austria and Switzerland in the global ranking, reflecting the high-value nature of Ireland’s FDI sector, which is dominated by the life sciences and electronics industries.

However, having held the top spot last year, Ireland has been bypassed by Singapore as the country with the most jobs created per capita through foreign direct investment.

Hungary holds third place.

Ireland benefited from approximately 195 jobs per 100,000 inhabitants as a result of foreign businesses investing here, the report found.

“It is particularly noteworthy to again see Ireland in the top three despite its much-publicised economic and fiscal difficulties” the report notes.

“This clearly shows that companies are looking at structural factors such as a favourable business environment, skills availability and cluster/sector strengths when deciding where to invest, rather than cyclical phenomena such as short-term economic growth prospects or fiscal deficits.”

Welcoming the report, the IDA said it highlighted Ireland’s “continued high standing in the world as a leading location for foreign direct investment”.

This position has been endorsed by recent investments from companies such as Coca Cola, IBM, Intel, Google, EA and Facebook, the agency added.

According to the report, 2010 signified the return to growth in the global market for foreign investment as companies restructured global supply chains and internal operations in a response to increased globalisation.

However, IBM said that foreign investment activity was likely to decline or stagnate in the near future, due in part to the ongoing debt crisis in many mature economies.

“This will likely have direct consequences for economic activity in these countries and further afield, with possible ensuing perils to consumer confidence that seemingly would affect companies’ willingness to invest in new facilities across the world,” it added.