Oireachtas Joint and Select Committees

Thursday, 20 February 2014

Joint Oireachtas Committee on European Union Affairs

Review of Foreign Policy and External Relations: Discussion (Resumed)

3:20 pm

Dr. Pat Ivory:

I will try to deal with the questions Ms Cross only touched on or left completely for more of a business focus. Regarding the democratic legitimacy of the EU system, it is important to recognise where legislation and directives are formed. Ms Cross made the point that, for example, in the trade area the European Commission has competence. We work very closely with officials here in Ireland who are engaged in the trade committee of the Council. We work very closely with the permanent representation in Brussels. The resources are focused in Brussels on important issues in terms of where the permanent representation has its focus - for example, on energy and climate change, taxation, institutional engagement, transport, trade and the development of the food and drinks sector.

Regarding alliances, it very much depends on the issue and one will have different alliances for different issues. For example, one may have one alliance for advancing trade and investment with the US, another for developing the digital economy here within Europe and a different alliance for developing the food and drink sector. In Ireland we have strong alliances regarding pharmaceuticals and medical devices with various European groups. The type of alliance one builds depends very much on the issue with which one is dealing.

One must be very careful in how one chooses one's partners and not just to think in terms of whether a country is a natural ally. One must look at what is on the table and one is trying to advance in building these alliances.

On the question of regional development, an issue raised by Deputies Joe O'Reilly and Bernard J. Durkan, the Acting Chairman, we certainly give priority to having a regional focus in terms of policy, as well as having a national focus. We have a developed regional network with regional offices and executives throughout the country. It is an appropriate time to look again at the national spatial development strategy and how it can aid regional development. There is also the development of business clusters around the country. There are different clusters such as a medical devices cluster in the west, a pharmaceuticals cluster in Cork and an international services cluster in Dublin. Deputy Joe O'Reilly mentioned Cavan and Monaghan. There has been significant investment in infant formula manufacture in Cootehill, County Cavan, by Abbott Nutrition and Town of Monaghan Co-op Limited has strong development in the dairy and food sector. It is a matter of looking at and leveraging cluster development across the country.

The Acting Chairman, Deputy Bernard J. Durkan, raised the issue of roads development, which is very important. Having developed five core networks of roads across the country, major urban road development has been one of the most positive elements in the development of infrastructure in recent years, but more work must be done, for example, in progressing the Gort to Tuam bypass. We are returning to a situation where public private partnerships will again be possible in Ireland. Our ability to borrow on international markets has greatly improved, with our ten year bond rates much closer to German rates than they were in the past few years. We have come out of the troika programme in a particularly strong position with respect to borrowing. There should be a focus on transport, telecommunications and educational infrastructure development across the country. It is time for us to look again at how we can ensure infrastructural development is a key priority in the year ahead.

With regard to Deputy Seán Kyne's comment on a balanced climate and energy policy, it is clear that the internal energy market must be completed and that the European Union must redouble its diplomatic efforts in securing energy resources, which is very important. At the same time, however, Ireland must ensure that in implementing the rules the benefits we have secured on an all-island basis for a single electricity market are retained. Energy is a key question not just in Ireland but also across Europe in terms of the availability of shale gas in the United States, which has heightened competitive issues. We must examine how Ireland and the European Union can ensure we will have efficient energy resources and that energy prices and costs for manufacturing are controlled and kept as low as possible in order that we can compete both in terms of trade and investment.

Before I refer to the United Kingdom, Deputy Joe O'Reilly asked about Taiwan. It is a very interesting question. Development in Taiwan is very strong in certain sectors, particularly software. I understand Taiwan will organise some ministerial and business-led missions to Ireland this year. We will be very happy to meet these delegations when they visit Ireland. Taiwan has been a trading partner of Ireland for many years. That is significant and should be developed. On the diplomatic side - I would not claim to be an expert on international diplomacy - I understand diplomatic relationships have changed since 2008. That is important in terms of the relationship between China and Taipei also.

As regards the referendum in the United Kingdom on EU membership, it is clear to us in terms of our engagement both at European level and in the United Kingdom that the business community in the United Kingdom has taken a very firm position that it is in the best interests of the United Kingdom to remain part of the European Union. Eight out of ten businesses in the United Kingdom have stated they wish to remain part of the European Union. Our colleagues in the Confederation of British Industry, CBI, produced a very interesting report which examined various options such as those of Norway and Switzerland. One of the interesting results of the study was that the advice of the people in Norway and Switzerland was that the United Kingdom should remain part of the European Union, if it wished to influence legislation, regulations and directives from the Union. If one is outside the European Union, one must often apply these regulations and directives, if one wishes to participate in the Single Market, which everybody wishes to do because of the strength and continuing development of that market in goods and services. A country must meet the same standards and regulations in a number of directives.

Of course, some issues are more contentious than others in terms of the difference between economic regulation and social regulation and flexible labour markets. It is a complex range of issues. It is healthy for the European Union to consider how it can reform and ensure it is operating in the most efficient and effective way possible in the regulations it introduces. There is a common interest in looking at European Union reform both between Ireland and the United Kingdom and between Ireland and other European member state partners. It is always healthy for the European Union to look at how it is doing things and ways in which it can reform to make it more effective and competitive on a global basis. However, from a business perspective, being a member of the European Union is certainly more advantageous than being outside it.

It is important, too, that we recognise that there are many areas in which we might collaborate with the United Kingdom. Advancing trade is one of them, as well as investment across the world.

We have common interests in opening up markets, but we also compete with the United Kingdom in important areas such as foreign direct investment. We need to look at what is happening there and in other jurisdictions within Europe and ensure our offering to attract investment here is at the level it should be and needs to reach. We need to think continually think about the competition we will face from other countries in attracting investment to Ireland and make sure we are the best in class in our offering.

I think I have covered all of the items raised. Is there anything on which I have not touched?

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