Ireland has become the top destination for US multinational investment and the economic bond between the countries is only likely to intensify, according to a leading Wall Street economist.
In a report on the economic relationship between Ireland and the US, compiled for the American Chamber of Commerce Ireland, veteran Wall Street global economist and strategist Joseph P Quinlan said Ireland has “done a very good job of aligning itself with key future growth drivers” in attracting investment from the leading lights of the digital economy.
Mr Quinlan said this kind of move, and ‘micro’ factors such as ease of doing business, good infrastructure and skills, and respect for intellectual property rights has boosted Ireland above and beyond its attractive corporate tax rate.
“It’s not just about the macro,” Mr Quinlan said, noting the lack of such micro advantages in other low-tax territories such as India and China. However, he added that Ireland can never rest on its laurels regarding inward investment, as it is also competing against US states for multinational money, not just other European and emerging nations.
However, he suggested he saw no evidence that the Government is taking US FDI for granted. While US investment to Europe fell by 19% year-on-year to $115bn in the first nine months of last year, its investment in Ireland grew by 42% to $37bn.
In Dublin yesterday to launch his report, Mr Quinlan offered little opinion on proposed changes to international tax policy and the Government’s removing of the ‘double Irish’ tax avoidance mechanism.
However, he stressed the need for improved partnerships between universities and multinationals and urged the formation of programmes to attract foreign entrepreneurs to establish firms in Ireland.
“The critical task in front of Ireland is ensuring its place in the high-end, value-added chain of multinationals, notably in services and evolving technologies that will change the nature of work and production,” he said. “The race to remain globally competitive never ends. Unlike many nations in Europe, Ireland understands this dynamic all too well.”
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