Horn urges bias towards skilled jobs

State agencies should help large multinationals to outsource some of their low-value and low and medium technologies overseas to cut costs so that they retain their higher-skilled operations here, the chairman and founder of Iona Technologies told delegates at the IMI conference in Killarney.

Dr Chris Horn said: "We already are such a highly regarded nation for manufacturing, particularly by American corporates. We are trusted. We develop and deliver quality products on time in high-tech areas, so let's be more proactive about actively reducing the costs of manufacturing by putting low-cost sub-assemblies overseas but retaining control of the situation from Ireland."

He added that the State should investigate combining the skills of the IDA which focuses on attracting multinationals and Enterprise Ireland which aids indigenous companies to find markets abroad to help multinationals outsource some of their lower-cost operations and become more competitive here. "Surely that's more preferable to be proactive about that rather than one day getting a phone call from the American parent saying 'Sorry, we're closing you down. We're going to move to Estonia which is one example we had recently where we lost a company because the costs of operations in Estonia were far cheaper'," he said.

Dr Horn warned that the countries of Eastern Europe and Asia, in particular China, were providing increasing competition for foreign direct investment. Many of these countries were copying Ireland's transformation from an agricultural economy to a clean, high- tech, services economy, he said.

"We are in severe danger of being left behind by teaching the rest of the world," he said. "Our vision is so limited to what is happening around us."

But he said that these countries offer enormous trade opportunities for indigenous Irish companies and he urged Irish companies to target global markets and be more aggressive.

The roll-out of broadband, which he said was as important as the national electricity grid, was key to helping develop Ireland as the enterprise nation of Europe.