Ms Mary Buckley:

I thank the committee for inviting IDA Ireland to attend to discuss the likely economic impact of Brexit. I am accompanied this evening by my colleague, Mr. Denis Curran, who is the manager of our financial services division.

Ireland has performed extremely well in attracting FDI over many years. We have over 1,200 FDI companies employing over 187,000 people. These companies account for more than two-thirds of the corporation tax take in Ireland. They account for €130 billion in exports and they contribute €9 billion in pay per annum. The years 2015 and 2016 have been excellent ones for FDI. IDA client companies created just under 19,000 jobs on the ground during 2015 across a range of sectors, with every region of Ireland posting net gains in jobs. In 2015, 213 companies invested in Ireland, 94 of which were investing in Ireland for the first time. Our mid-year results for 2016 were announced in July and show we are ahead of the first half of last year, with 9,100 jobs created and 115 investments secured. Ireland’s stable business environment and certain access to the EU market means Ireland is extremely well placed to win new FDI investments in Europe. Ireland has a unique perspective and interest in Brexit. Our relationship with the UK is closer than with any other member state. Brexit is not what we hoped for but we fully respect the decision of the British people. Ireland will continue to be a core member of the EU single market and euro currency. This is one of the key reasons that companies choose Ireland as a place to locate.

IDA believes there are potential opportunities for Ireland arising from the vote by the UK to leave the European Union. However, quantifying these at this point is not possible. Ireland has a strong track record in winning FDI. In terms of employment creation from FDI over the past four years, Ireland has been second only to the UK in the areas of technology, consumer and content business services and international financial services. We also have strong attributes that are of interest to global companies: we are English-speaking; we are a member of the European Union and the eurozone; we have a common law legal system similar to the UK; and we have a direct land border and close geographical and cultural links with the UK. Ireland also provides an opportunity to passport into the wider the European Union market from any part of Ireland. We believe these attributes are of interest to companies but the best way to explore these ideas is through direct contact with companies, existing or potential.

Areas of increased FDI interest are likely to be services companies such as international financial services, technology, consumer and content business and life sciences in the short term and in the medium term in the manufacturing sector and pharmaceuticals, bio-pharmaceuticals, med-tech and engineering. There are a few different categories of clients and potential clients where we see opportunities: existing IDA clients with a presence in Ireland who also have a presence in the UK; overseas clients who have a presence in the UK but not in Ireland; UK companies operating in the UK which now need certain access to the European market and international clients without a presence in Europe seeking a European base.

IDA Ireland has taken a number of steps to ensure we carefully manage the uncertainty the vote has created. We are members of the Brexit co-ordination group established by the Minister for Jobs, Enterprise and Innovation, Deputy Mary Mitchell O'Connor. The group consists of the CEOs of both IDA Ireland and Enterprise Ireland, as well as relevant enterprise, single market and trade officials from the Department. The group has met on a number of occasions since June to address the response to the referendum result and the messaging to business both domestically and overseas. The Minister, Deputy Mitchell O'Connor, has continued to chair the group as part of the Department's ongoing response as developments unfold. We have established an internal Brexit team at senior level. Following the vote, we wrote to 1,200 of our existing clients to reassure them Ireland will remain in the European Union, to remind them of Ireland’s positive attributes including talent, skills, tax and ease of doing business and to offer assistance, advice and support. We have also initiated a global advertising campaign highlighting Ireland's attributes as a key European FDI location and this will be supported by further public relations activities later this year.

Every investment agency in the world will be competing to win mobile investment in a post-Brexit environment. Notwithstanding our strong baseline position, Brexit will result in risks in the short and medium term. These risks include a long period of uncertainty leading to the stalling of investments, dampening of FDI growth and, consequently, global FDI flows, decreased attractiveness of the European market, direct impact on existing IDA client companies, some of which are heavily exposed to UK and the impact of Brexit on the Irish economy. The shape of the UK's future relationship with the EU after Brexit is, as yet, unknown. It is important that we monitor developments to continually assess the implications of whatever model emerges in terms of its impact on Ireland's attractiveness for FDI relative to the UK.