Dáil debates

Wednesday, 17 December 2014

Ceisteanna - Questions - Priority Questions

IDA Data

9:30 am

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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1. To ask the Minister for Jobs, Enterprise and Innovation the number of new overseas offices established by IDA Ireland since 2011; the number of staff in each new office; the number of offices closed during the period; the plans by IDA Ireland to exploit opportunities in the Middle East and BRIC countries; the number of IDA Ireland staff based in Middle East and BRIC countries; and if he will make a statement on the matter. [48392/14]

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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My first question relates to IDA Ireland's presence in BRIC and Middle East countries. It is a replica of a question that I tabled in January. I would like to know what progress has been made in the intervening period.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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Since 2011 IDA Ireland has opened three additional offices in overseas locations. During 2013 two additional overseas offices were opened, one in Korea and one in Beijing, with one member of staff in each office. In 2014 an additional office was opened in Texas in the United States. It has two staff members. In 2011 IDA Ireland ceased to have a presence in Taiwan, with activity now being managed from China.

The BRIC countries - Brazil, Russia, India and China - form the core countries of IDA Ireland’s growth markets strategy, together with the ASEAN region, comprising South Africa, Japan, Korea, Australia and New Zealand. Since 2007 IDA Ireland has opened offices in all of the BRIC countries. The agency now has three offices in China and two in India, as well as having a presence in Moscow in Russia and Sao Paulo in Brazil. These offices are staffed by a combination of permanent staff, contract employees and part-time consultants, numbering 11 in all. In the past three years IDA Ireland has secured an emerging base of investments from India - HCL, Wipro, TCS and Genpact - and China - Huawei, ICBC, CDB and Satir - and was integral in facilitating the acquisition of Air Atlanta’s aero-engineering facility at Shannon by the Russianairline Transaero.

Although IDA Ireland does not have an office in the Middle East, I am informed by the agency that its growth markets team in Dublin, in conjunction with its international financial services division, works with the embassy network in the region to identify and target prospective client companies, particularly in the growth area of Islamic finance.

One of the disruptive reforms set out in An Action Plan for Jobs 2014 is the Winning Abroad initiative which targets the creation of an additional 10,000 jobs - 6,000 direct and 4,000 indirect - over and above the annual jobs target of 13,000. Additional resources have been provided for IDA Ireland to enable the agency to recruit an additional 35 staff on a contract basis for a period of three years to cover the lifetime of the initiative. The additional staff will be based at various locations, including Boston, New York, Chicago, Atlanta, Austin, Mountain View, Irvine, London, Frankfurt, Paris, Tokyo, Shanghai, Sydney and Dublin. To date, 21 staff have been recruited and interviews are ongoing to fill the remaining positions.

One of the high level goals set out IDA Ireland’s strategy document, Horizon 2020, for the period 2010 to 2014, is that of achieving 20% of greenfield investment from high growth markets, including the BRIC countries, by the end of 2014. The agency informs me that it is confident that this target will be achieved.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I ask the Minister to provide more detail on the question of meeting the 20% target. He has said IDA Ireland is "confident" that it will be achieved, but it only has two weeks in which to do so. Is there any monitoring by the Department of IDA Ireland in reaching the target?

On the 35 new staff recruited, I notice that the BRIC markets are well down the priority list. While I welcome the investment in North America, we already have a very strong and successful presence there. Is there merit in placing the greater proportion of the additional staff in the growing markets, that is, the BRIC countries, rather than in ones in which we are very well covered? The President has just concluded a very successful visit to China, to where I know that there have been a lot of trade missions. However, the key to success, particularly in China but also in the other BRIC markets, is having a presence and active and ongoing engagement. While high profile visits are very beneficial and often very successful, we need boots on the ground constantly. In the context of the aforementioned 35 new staff, should the emphasis be on the BRIC countries?

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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I can report good progress in meeting the 20% target. In 2011, 8% of greenfield investment came from high growth markets, while the figures for 2012 and 2013 were 14% and 16%, respectively. IDA Ireland is confident that it will hit the 20% target this year. There are still a number of investments yet to be considered by the board of IDA Ireland; therefore, the definitive figure for 2014 will not be known until after the board's last meeting of the year which will be held next week.

I take the Deputy's point about focusing on emerging markets. There is always a balance to be struck between new areas that will be high-growth in the future and existing areas that are yielding a very high investment. That is one of the areas IDA Ireland is examining very closely in its current strategy. Clearly, there is merit in opening up these new markets, given that 90% of future growth is projected to take place outside the European Union, particularly from the ASEAN region. It is, however, a question of striking a balance. It is important to note that 70% of the flow of investment is still coming from the USA; therefore, we cannot neglect growth areas within that country. Clearly, growth has shifted from the traditional east coast locations to other parts of the United States such as Texas which we are targeting, as well as areas in the south east such as Raleigh. There is a response in areas of opportunity.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I wish to ask about the relationship between the Department of Jobs, Enterprise and Innovation and the Department of Foreign Affairs and Trade. In the context of trade being the responsibility of the Department of Foreign Affairs and Trade for the past three years or so, what monitoring takes place of the economic wing of that Department? What is the level of monitoring of economic promotion and investment work undertaken by embassies, particularly in the BRIC countries? Is the Minister confident and happy with the relationship between his Department and the Department of Foreign Affairs and Trade?

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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As the Deputy knows, when his party was in government, the Export Trade Council was established. One of the initiatives in our programme for Government was to include private sector members in the council. The council meets quarterly and closely reviews progress made across all of the agencies, not just those under the aegis of my Department, including, for example, Bord Bia, Fáilte Ireland and so on. It is working well and all of the agencies are reporting that they are exceeding their targets, with the exception of those involved in the tourism sector which was hit very hard in one year but which is doing really well in recovering markets. Increasingly, there is an Ireland House-Team Ireland approach being adopted. There is, however, further work to be done in looking at individual countries and delivery of plans within these countries. That is one of the ambitions of the Export Trade Council, namely, to look in a more granular way at individual markets and build on the success of this approach.