Chambers seek to protect Shannon

Five Chambers of Commerce representing more than 1,000 businesses in Shannon have united in opposition to a proposal by the Tánaiste to transfer the operation of the Shannon Free Zone to the incoming Shannon Airport Authority.

A statement on behalf of Limerick, Shannon, Ennis, Tralee and Thurles Chambers of Commerce yesterday described Ms Harney's proposal "as both short-sighted and a totally inappropriate solution that will damage both organisations to the detriment of the economy of this region".

Shannon Development operates the Shannon Airport Free Zone and already its chairman, Mr Liam McElligott, has described the proposal as "flawed". He warned that, if implemented, it "would seriously undermine our capability to play a meaningful role in regional development".

But it has been argued that for the incoming Shannon Airport Authority to succeed, it would need the €6 million in annual rents generated by Shannon Development from the Free Zone to bolster its finances. The PricewaterhouseCoopers report on the break-up of Aer Rianta points to the financial challenges which Shannon would face.

The Free Zone contains the largest cluster of US investment in Ireland, employing more than 7,300 people with annual exports of more than €2.5 billion.

Claiming that the proposal would have a hugely negative impact on the mid-west, a chambers spokeswoman said: "The Shannon Free Zone is a huge asset to Shannon Development and must be safeguarded. The company has an unbeaten track record in its commitment to investing in the region and promoting the mid-west as an economically viable and attractive place in which to do business."

She said any change to this structure "would be catastrophic for the region". She argued there was even more need today for regional economic focus, to counter the imbalance in economic development of Dublin and the east coast.

The chambers argue that the rent roll from the Shannon Free Zone is a vital resource for economic development in the region and it is essential that it continues to be used for this purpose.

The spokeswoman added: "The task of the new airport authority is to make the airport a viable and sustainable entity in itself, reducing its cost-base in order to compete successfully for business in the fastest-growing sector, the low-cost airline market."

The chambers say Shannon needs a strong sustainable airport authority working in tandem with a strong sustainable Regional Development Company.

"Subsidies do not work - they allow an organisation to remain inefficient and ineffective and such organisations never succeed in the long run. The cross-subsidy proposed is one sure way to ensure we will have neither," according to the spokeswoman.