The pipeline of foreign direct investments will remain “strong” this year although there are “significant” challenges for Ireland to address if the State is to continue to attract multinational projects here, the new chairman of the IDA will tell the Oireachtas enterprise, trade and employment committee on Wednesday.
Feargal O’Rourke, a former managing partner of PwC who took over as chairman of IDA Ireland in January, will say the “single biggest task” for the agency is to “shape a strategy” for the organisation for the next four years.
“This is against the backdrop of significant geopolitical uncertainty with the resultant impact on the business environment; a more muted pace of growth in the global economy; a more active industrial policy from some competitor nations; the challenge of climate change and the opportunity of the green transition... and of course the AI revolution that is taking place,” he will say.
In his opening statement to the committee, Mr O’Rourke will use a sporting analogy to sum up the challenge facing the IDA. “In sporting terms, IDA Ireland is like Limerick in hurling or Shamrock Rovers or Manchester City in football. We have a fantastic record of success, but once the year or season is over, we must do it all over again. We can survive a year where we are not top of the pile – but we cannot afford to enter a period where we are living off past glories.”
He will say Ireland’s ability to compete depends on dealing with challenges relating to energy costs and renewable energy provision, housing, infrastructure and utilities. “With countries around the world vying to win the race for the next generation of FDI growth, the opportunity cost of not addressing these issues in a timely manner, particularly sustainable energy supply, risks being sizeable.”
He will tell the committee that the IDA’s approach this year will recognise the need to help the Irish operations of global firms “transform to thrive in a fast-changing world” and will involve the State agency actively partnering with client companies on investments in talent development, digitalisation, R&D, innovation and sustainability.
“With the requisite national enabling conditions in place – aligned to emerging FDI attractiveness factors such as AI skills and renewable, reliable, affordable energy – we will be well placed to capture new investment opportunities,” he will say.
His statement notes that IDA clients directly account for 11 per cent of total employment here and spend €35.8 billion annually on payroll and Irish-sourced goods and services, €15.5 billion on capital expenditure, and more than €7 billion on in-house R&D and innovation.
While 2023 was a “turbulent year”, IDA approved 25 sustainability projects focused on carbon abatement and building Ireland’s green economy. Overall, 248 investments were approved by IDA in 2023 with the potential to create almost 19,000 jobs as the projects come on stream.
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