Firms told to refocus on exports

IRELAND has no future in low-cost manufacturing and cash-strapped companies should focus their business efforts on exports and trade with new world economies, the head of Enterprise Ireland has said.

Businesses were still finding it difficult to access credit from banks, an Oireachtas committee was told.

However, a new generation of Irish companies with international links involved in the smart economy were making healthy profits, Enterprise Ireland chief executive Frank Ryan said.

New figures released by Enterprise show Irish exports grew by 3% last year. Companies linked with Enterprise Ireland saw over 8,000 job losses during the same period, 65% of which were linked to the construction sector.

Mr Ryan said the way forward for businesses was through the smart economy, leaving behind an old industrial era.

“There’s no future in low-cost manufacturing,” he added.

There were small companies with links to technology and computing making turnovers of over €50 million, he told the Public Accounts Committee (PAC).

Anglo Irish Bank had given €350m in credit to companies since the start of the year, but accessing finance was still a difficulty for many businesses.

Enterprise Ireland said a number of its senior management staff had received bonuses in 2007.

The top bonus paid was over €40,000, while another 16 managers received between €10,000 and €16,000 above their salaries.

Mr Ryan said businesses needed to target new economies like Brazil, India, China and Russia among countries.

Meanwhile, the committee also heard yesterday how a Science Foundation Ireland computer system cost double its original price.

“Weak project governance” was to blame for the near €400,000 computer system, which in the end was only partially used by SFI, committee members were told.

The foundation’s director general Frank Gannon admitted there had been “inadequate scoping out” of the project.

Changes had since been introduced on the payment and checks of projects, committee TDs were told.

Mr Gannon meanwhile told the committee more career guidance was needed in schools to encourage students to take up engineering, maths and science subjects.

“We need to establish that jobs in that area are not ‘strange’ but that they are normal jobs.”