Small Business Column: The best small country in the world to do business?

This week, Kehlan Kirwan examines Ireland’s claims to be one of the best countries in the world to do business as we play catch-up with the more advanced economies of the US and UK.     

In recent weeks I’ve noticed a number of articles appear in national newspapers questioning whether or not Ireland really is one of the best places to do business. The points they made centered on venture capital and foreign direct investment (FDI). It questioned why we’re not as good as our UK and US neighbours at both.

Put simply, Ireland as an economy and as a start-up nation is still in its infancy. While the past five years has seen tremendous growth, we’re still not a match for the likes of London or Silicon Valley. They are a couple of decades ahead of us. We’ve done well just to start closing the gap in recent years. The likes of venture capital and crowd funding is very much a new phenomenon to Ireland and we’re only learning the ropes.

The vast majority of capital raised in Ireland still comes from financial institutions. Venture capital is something we’re still learning about.

Claims that FDI is down are fairly accurate. At last look we were down nearly 30% on FDI investment. This doesn’t mean the end of our purple patch of coaxing foreign companies into the country. We’ve raced out of the blocks so quickly in this respect, it should never have been a given that we could keep up that level of investment forever. There are bound to be lulls, there are always lulls. The last time we believed something would go on forever everything ended up falling apart. Be careful what you wish for.

The arguments are still based on money, instead of taking a broader look at the overall state of Irish business.

Business sentiment is at its highest point for a long time and businesses are hiring again. That is a positive indicator in itself.

Dig further still and you’ll find that we’ve developed the bones of something that provides us with a very bright future. We’ve begun to make things again. Industry is working hard in both foreign and domestic markets to establish a valuable network of clients around the world.

We’re still learning and should by no means be expected to become the leading light of the EU in a few short years.

The amount of Irish companies opening offices in New York or California is rising at a rapid rate. It’s not simply about the money, it’s about the network. Making it easier to get to the right people, the decision makers.

However, let’s not get ahead of ourselves. We still have a lot that needs to be done. Tax breaks for family investment, county councils that compete for business and more awareness of industry specific schemes. We’re still not even close to how good we can be. The system isn’t streamlined and maintaining a business with core costs is still difficult.

However, you cannot deny just how far we’ve come in seven years. If we keep comparing ourselves to countries decades ahead of us, we’ll never get there. If you want to be the best, you have to beat the best. That means playing the long game, not the short gain.