Written answers
Thursday, 24 October 2024
Department of Enterprise, Trade and Employment
Economic Growth
Bernard Durkan (Kildare North, Fine Gael)
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156. To ask the Minister for Enterprise, Trade and Employment the countries he sees as the greatest competition for Ireland over the next five years in respect of the manufacturing and services sectors; and if he will make a statement on the matter. [43861/24]
Peter Burke (Longford-Westmeath, Fine Gael)
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Ireland currently holds a strong competitive position globally. The Institute for Management Development (IMD)’s World Competitiveness Yearbook 2024 ranks Ireland as the most competitive country in the euro area and the 4th most competitive economy. This performance is underpinned by several key factors, including a highly skilled workforce, strong economic growth, and success in attracting foreign direct investment in high-value sectors.
In particular, our competitiveness position is buoyed by our performance in terms of Government and Business Efficiency. The IMD point to our strong public finances, business legislation, alongside strong management practices and positive ‘attitudes and values’ as being significant factors behind Ireland being a great place to do business.
The most critical competitiveness deficit remains Ireland’s Infrastructure performance, in particular our performance under Basic Infrastructure where we rank at 38th (down from 29th in 2023). This includes management of water infrastructure, our energy infrastructure and relatively high electricity costs.
In terms of Ireland’s competitiveness challenges, the National Competitiveness and Productivity Commission recently published its annual report – Ireland’s Competitiveness Challenge 2024 – and outlined the challenges to Ireland’s competitiveness and productivity over the medium term and the policy responses required to meet them. On foot of this report, the Taoiseach held a Competitiveness Summit on the 2nd of September with relevant Ministers and stakeholders to discuss the major competitiveness challenges facing Ireland and action necessary to address these. Responding to the Summit, and the challenges facing Ireland’s competitiveness, the Government has made a number of decisions aimed at enhancing our competitiveness performance including: continued progress on the delivery of infrastructure, Ireland’s involvement in Important Projects of Common European Interest, the reduction of regulatory burden, the sustainable utilisation of the National Training Fund, the need to promote competition in domestic markets, among others.
The issue of competitiveness has also received significant attention over the last year under the EU agenda. The recent Draghi report on ‘The Future of European Competitiveness’ echoes many of the concerns which Ireland has in terms of its own competitiveness position – particularly in relation to energy costs, infrastructure delivery and the need to encourage the scaling of innovative firms. These are areas which have dragged on our own competitiveness in Ireland, and often most pointedly through its impact on business. The report identifies increased competition from the USA and China in the years ahead as a risk to the EU’s (and therefore Ireland’s) competitiveness position. Ireland remains committed to open rules-based trade. Ultimately, Ireland’s competitiveness performance will depend upon policies implemented at the national and EU levels which promote strong innovation and productivity growth.
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