Written answers

Thursday, 5 June 2014

Department of Jobs, Enterprise and Innovation

Foreign Direct Investment

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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52. To ask the Minister for Jobs, Enterprise and Innovation the extent to which foreign direct investment has resulted in job creation in each of the past five years to date; and if he will make a statement on the matter. [23967/14]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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54. To ask the Minister for Jobs, Enterprise and Innovation the extent to which foreign direct investment continues to play a role in enterprises here resulting in job creation; and if he will make a statement on the matter. [23969/14]

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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58. To ask the Minister for Jobs, Enterprise and Innovation the extent to which he expects job creation to continue arising from foreign direct investment here over the next two years; and if he will make a statement on the matter. [23973/14]

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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I propose to take Questions Nos. 52, 54 and 58 together.

Foreign Direct Investment (FDI) has been, and will continue to be, an integral part of Ireland’s economic development strategy. Foreign-owned firms contribute substantially to Ireland’s exports, jobs, expenditure in the Irish economy and to Exchequer funds. FDI plays a key role in stimulating the development of ‘new’ sectors in Ireland, in enhancing our research, development and innovation performance and in accelerating the achievement of critical mass within sectors. Every 10 jobs in an IDA Ireland client company supports 7 jobs in the wider economy.

I am glad to say that the numbers employed in companies supported by IDA Ireland has steadily increased in the five year period 2009 to 2013 inclusive. Total employment in IDA Ireland client companies (including companies that were formerly clients of Shannon Development) has risen from 144,843 in 2009 to 166,184 in 2013.

The Action Plan for Jobs is a key component of the Government’s response to the unemployment problem and its specific ambition is to have 100,000 more people in work by 2016. The Government has set out an objective to create a positive environment to support business start-ups and growth, drive exports and facilitate job creation and retention by the enterprise sector.

Under the 2014 Action Plan, IDA Ireland is tasked with the creation of 13,000 new gross jobs (yielding approximately 6,000 net new jobs) during the year. Significantly, under the Plan additional resources are committed to IDA Ireland aimed at achieving an increased market presence and consequential delivery of additional 10,000 new jobs (6,000 direct and 4,000 indirect) over and above the year’s target of 13,000, intensifying employment growth over a five year period.

In addition the Action Plan for Jobs 2014 includes a commitment to develop a framework for a Regional Enterprise Strategy to better integrate the efforts of the enterprise development agencies and other regional stakeholders in supporting enterprises. My intention is that the framework will be developed on a pilot basis initially, focusing on the Midlands region, and involving the agencies under the remit of my own Department – Enterprise Ireland, IDA Ireland and the Local Enterprise Offices. The objective is to enhance synergies between the agencies and their client companies and build on the competitive strengths of the region to maximise the potential for job creation. The role which other public bodies in the region can play in working towards this objective will also be examined as the project develops. The aim is that this framework will serve as a model for other regions of the country.

Under the 2014-2020 Regional Aid Guidelines, which will enter into force on 1 July 2014, areas accounting for 51.28% of Ireland’s population will now be eligible for assistance. This represents a substantial increase from the 25% originally proposed by the Commission, and an increase from the 50% under the 2007-2013 Map. Another key issue for Ireland in the negotiations on the Regional Aid Guidelines with the Commission was the prospect of not being allowed to grant aid large enterprises. Ireland was part of a group of Member States that successfully negotiated a compromise with the Commission whereby it will be possible to provide investment aid to large enterprises for new economic activities and diversification of existing enterprises into new products or new process innovation. Aid intensity rates were also maintained at their current levels.

While the global outlook for FDI continues to be challenging, I am satisfied that IDA Ireland will continue to deliver on its target of creating a further 13,000 jobs this year as set out in the Action Plan for Jobs 2014.

Photo of Bernard DurkanBernard Durkan (Kildare North, Fine Gael)
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53. To ask the Minister for Jobs, Enterprise and Innovation the extent to which major foreign direct investors here have been in a position to access EU supports in terms of science and innovation grant aid; and if he will make a statement on the matter. [23968/14]

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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European research programmes provide valuable opportunities for Irish-based firms to engage in high-level international research, while also being a critical source of non-exchequer funding for this important economic activity.

Running from 2014 to 2020 with a budget of almost €80 billion, Horizon 2020 is the EU’s new programme for research and innovation and is part of the drive to create new growth and jobs in Europe. Horizon 2020 is a core part of Europe 2020, the Innovation Union and the European Research Area and is responding to the economic crisis through investing in future jobs and growth, addressing people’s concerns about their livelihoods, safety and environment and strengthening the EU’s global position in research, innovation and technology.

Ireland is well positioned to benefit from Horizon 2020, building on our excellent performance in the last EU programme for research and development, the Seventh EU Framework Programme (FP7), where some €600m in funding was awarded to companies and academics in Ireland. Irish-based foreign multinationals are actively supported by to engage in collaborative international research. In FP7 there were over 400 participations by 70 IDA Ireland client companies, with over €32m of funding awarded to such companies.

In December 2013, the Government approved a national strategy for participation in Horizon 2020 together with an ambitious target of €1.25 billion in funding to Ireland over the lifetime of Horizon 2020. The strategy sets out a comprehensive range of actions designed to maximise Ireland’s participation in the programme and achieve the target, involving all of the key Departments, agencies and research performers. A Horizon 2020 High Level Group, under the chairmanship of the Department of Jobs, Enterprise and Innovation, has been established to oversee the implementation of the national strategy. This includes identifying key areas of opportunity where researchers, agencies and companies in Ireland can maximise their participation in the programme.

A national support network of National Contact Points coordinated by Enterprise Ireland has been established, comprising knowledgeable and experienced practitioners from relevant Departments and agencies, charged with helping companies and academics access the funding opportunities presented by Horizon 2020.

I am confident that, building on our successful performance in FP7 and supported by our national strategy and a strong national support network, Irish companies and multinational corporations based in Ireland will continue to have excellent support to compete for Horizon 2020 funding.

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