John Perry (Sligo-North Leitrim, Fine Gael) | Oireachtas source

I appreciate what Deputy Deasy has said on investment and thank him for raising this issue. State aid regulation is a matter of major concern for Ireland and the operation of a level playing field across the European Union is critical to the pursuit of industrial development. Large enterprises have an important impact on regional economies. They stimulate competitiveness and productivity, upgrade the industrial base, facilitate SME growth, increase the level of competition in local markets and improve labour and management skills for the economy in general. In order to improve European competitiveness, create jobs and emerge from the current economic situation, it is essential that EU member states have sufficient flexibility to assist the regions make the required adjustments.

This is particularly relevant in Ireland, given the ongoing need to upgrade the industrial base and the fact that the economic crisis has had a severe impact on a number of Irish regions. The Government believes that the current economic crisis and resulting balance of payments imbalance provide a significant challenge to the European Union as a whole. This is particularly important given that international competition for investment is intensifying outside the Union. Regional aid is an important lever of European economic development and international competitiveness, and we are extremely concerned that a number of measures proposed by the Commission will inhibit potential investment in Europe's disadvantaged regions.

I understand clearly what Deputy Deasy has said in this regard and with regard to development taking place in Dublin, Cork and Galway. The European Union as a block must often compete with third countries for mobile foreign direct investment. Recognition should be given to the positive benefits for the EU economy and society of facilitating FDI, particularly in high-tech areas. State aid is also being provided for third countries to undertake measures we believe will benefit from some consideration by the Commission.

I assure the Deputy the Government is keenly aware of the impact of the proposed changes in the regional aid guidelines for the country and will strongly defend our interests in the multilateral discussions about to commence.

It is important for us to have a clear position. Despite the benefits of the aid that is currently provided, it is difficult to get industry into the BMW region. That difficulty would be far greater if that aid were to be diminished in any way. Our needs and interests will be highlighted and alliances will be forged to effect the best defence possible. I have been to Waterford. I have met the regional director of the south-east region. In light of the level of unemployment in the region, it is important for IDA Ireland to give every consideration to it when decisions on foreign direct investment are being made. I will speak to Barry O'Leary to ensure that the regions beyond the places mentioned by Deputy Deasy are considered. Ireland is striving to address a real economic crisis and to avoid a depletion of its historical national and regional economic development. If Ireland is to retain the flexibility afforded by the use of regional aid, as it needs to do, we must make our case strongly with the other EU member states in the coming weeks and months. Deputy Deasy has made an important point. I do not doubt that the Minister, Deputy Bruton, will fight in a determined manner to ensure we retain our regional benefits. We must make every effort to argue for foreign direct investment to be brought to regions where such industrial activity has not taken place before now.

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