Bernard Durkan (Kildare North, Fine Gael)
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Question 190: To ask the Minister for Enterprise, Trade and Employment the extent to which he has addressed or proposes to address issues affecting the manufacturing or services sectors; and if he will make a statement on the matter. [31654/07]

Micheál Martin (Cork South Central, Fianna Fail)
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My Department, in conjunction with the Enterprise Development Agencies, has taken a number of steps in recent years to identify and address issues affecting the manufacturing and services sectors particularly through implementation of the enterprise action plan arising from the Enterprise Strategy Group report and implementation of recommendations from the Small Business Forum.

The 2006 Forfás report on Manufacturing and Services indicated that, despite the manufacturing sector in Ireland experiencing a decline in employment in line with most developed OECD economies, it had achieved very significant increases in output, reflecting growing productivity in the sector. Simultaneously the decline in manufacturing employment has been offset by rapid jobs growth in the services sector. The report also found that competitiveness challenges in the manufacturing sector need to be addressed if it is to continue to play a major role in the economy.

As part of the commitments included under the partnership agreement 'Towards 2016', I established a high-level manufacturing group, to review the challenges facing the manufacturing sector and to identify further measures to meet those challenges. This Group, comprised of Industry, Employee, Government and Enterprise Agency representatives, is currently in the process of finalising a report outlining their views and recommendations to ensure that manufacturing continues to play a major role in our economy and will report back to Partnership early 2008.

To compliment the work ongoing in the High Level Group on Manufacturing, Forfás have established a group to look at the challenges and opportunities faced by the services sector. From this group we hope to prepare and position Irish enterprise to adapt to the globalisation of services with the aim of achieving sustainable and competitive services enterprise in Ireland based on three strategic imperatives:

Growing a cadre of Irish services companies that can expand into international markets (Overseas Direct Investment); and

Developing productive and competitive locally traded services including their globalisation potential.

The group have met on four occasions and a report outlining how to maximise the future returns to Ireland from services activities in all enterprises, both current and potential, is due at the end of March 2008.

Bernard Durkan (Kildare North, Fine Gael)
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Question 191: To ask the Minister for Enterprise, Trade and Employment if he has identified areas in the manufacturing or service sectors that are particularly and strongly competitive; his plans for the future development of such areas; and if he will make a statement on the matter. [31655/07]

Micheál Martin (Cork South Central, Fianna Fail)
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In 2004 the Enterprise Strategy Group report outlined the sectors where Ireland has considerable potential for future growth, building on existing expertise and capitalising on new opportunities in internationally-traded services, high-value manufacturing in a number of sectors and locally-trading businesses. A number of service sectors and activities were considered to offer opportunities for exploitation by indigenous enterprises and for increased inward investment and these are set out in Appendix 1.

The manufacturing sector in Ireland has evolved noticeably since 2000, in terms of the composition of industry and the nature of activities, and is likely to continue to do so. Manufacturing continues to be a significant employer accounting directly for 11% of total employment and a significant amount of associated services employment. In order to sustain and grow the sector, the Irish based manufacturing enterprises will have to continue the progression to high value added sectors and activities, and continue to increase productivity through investments in human capital, technology and innovation.

Irish manufacturers who engage in specialised, sophisticated, high technology and value added activities can continue to compete successfully on international markets. These sectors often require specialised skilled staff, specialised technologies and flexible operations, and other factors which are not readily available in many low cost economies, such as modern IP protection laws, a business friendly regulatory environment, etc.

Many companies in Ireland have built world-class high value added manufacturing and services capabilities, particularly in food, information and communications technology, software development, pharmaceuticals and medical technologies. Ireland's existing expertise provides a base for continued wealth creation over the next decade and we envisage that Ireland's manufacturing base will continue to move up the value chain.

As part of the commitments included under the partnership agreement 'Towards 2016', I established a high-level manufacturing group, to review the challenges facing the manufacturing sector and to identify further measures to meet those challenges. This Group is currently in the process of finalising a report outlining their views and recommendations to ensure that manufacturing continues to play a major role in our economy and will report back to Partnership early 2008.

The increasing importance of services is a phenomenon of most developed economies and Ireland is following this trend. Almost 70 percent of the Irish workforce is currently employed in services. More than one-third of Ireland's exports are in services and Ireland is now the 12th highest exporter of services in the world. The future performance in services activities will therefore be increasingly important to overall growth in the economy. To compliment the ongoing work of the High Level Group on Manufacturing, Forfás have established a group to examine the challenges and opportunities faced by the services sector. From this group we hope to prepare and position Irish enterprise to adapt to the globalisation of services with the aim of achieving sustainable and competitive services enterprise, part of the group's work will be to identify potential growth sectors for the future. The group have met on four occasions and a report outlining how to maximise the future returns to Ireland from services activities in all enterprises, both current and potential, is due at the end of March 2008.

Appendix 1

The following service sectors and activities are considered to offer opportunities for exploitation by indigenous enterprises and for increased inward investment:

Service Sectors

Education services,

Financial services,

Healthcare services,

Tourism,

Creative services,

Maritime services,

Aviation services,

Construction, Engineering and Environmental services,

Professional and Consultancy services,

Agricultural and Bloodstock services,

[Activities]

European Headquarters,

Franchising, Intellectual property,

Sales and Marketing,

Shared and Outsourced business processes,

Services delivered electronically i.e. eRetailing of Consumer Goods, eServices, Data Management,

Supply Chain Management