Bernard Durkan (Kildare North, Fine Gael)
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Question 192: To ask the Minister for Enterprise, Trade and Employment the issues affecting competitiveness in the economy; his proposals to address such issues in the short term; and if he will make a statement on the matter. [31656/07]

Micheál Martin (Cork South Central, Fianna Fail)
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There are a number of competitiveness benchmarks against which Ireland is measured. For example, the World Bank ranks Ireland as 8th out of 178 economies globally for "ease of doing business". This puts us in the top 5% of world economies in their survey. In its recently published report on global competitiveness rankings, the World Economic Forum (WEF) positioned Ireland, in 22nd position out of 131 countries. This puts us in the top 20% of its list of competitive economies. Within the areas measured we are in 5th place for financial market sophistication and 4th for "goods market efficiency". This is important because included in this category we are ranked 1st for the positive impact of business rules on foreign direct investment. We are also ranked in 1st place for the impact of foreign direct investment as an important source of new technology.

These issues are important because they underline our solid reputation as a flexible, competitive and technologically orientated economy in which it is worthwhile to invest. And of course what holds for foreign investors is equally true for the environment in which indigenous firms are encouraged to start and grow. These are clear and unambiguous competitive advantages for our economy.

Nevertheless, the broad enterprise sector and exporters in particular are facing some immediate challenges. For the most part these are driven by external events in currency, financial and commodity markets. The external value of the euro, flexibility and availability of credit and the unique and unprecedented cost of oil/energy are important cost components over which companies in Ireland have no control.

However, I am confident that the adaptability of our enterprise sector will overcome these challenges. Our forward looking enterprise policy has helped reposition the economy and influenced a structural change in what our economy produces. Our economy has moved into higher value added, technology based and more innovative products and services. This is reflected in another WEF competitive indicator based on business managers' belief that Ireland's competitiveness in international markets is founded more on unique products and processes, than low cost. We scored equal with the U.S. on this indicator of competitiveness and are well inside the top 15% of the economies looked at by the World Economic Forum.

This also reflects the strategic emphasis that my Department places on providing resources to enable enterprise in Ireland engage more successfully and profitably with the more complex yet higher yielding research, development and innovation process.

This will continue, at a strategic level through the National Development Plan and the Strategy for Science, Technology and Innovation. At firm level this will continue through closer engagement with individual companies by the enterprise development agencies. In respect of the very important indigenous sector, the early ground-work for this is already in place through Enterprise Ireland's new strategic direction to 2010, that I launched last month.