PAUL MILLS: The advance factory is a relic but projects are vital

The empty so-called advance factories in IDA industrial areas across Cork and the rest of the State are back in the news.

Councillor Anthony Barry outside the idle Carrigtoohill IDA site.

In my opinion, the advance factory is something of a relic from our dim and distant past.

The sites may no longer be a reliable anchor to attract more foreign direct investment.

The vacant sites may even provide evidence of failures of the past.

One could question the decisions taken in locating some of the facilities.

Politicians not so long ago would make a great play in securing an advance factory or, better still, an IDA industrial estate constructed in their ward or their constituency.

However, such practices serve no purpose as we move to address the challenges of an ever-changing business world.

Back then there were relatively few countries hunting out and luring those companies, which needed to establish a base to gain access to EU markets.

In any event, the advance factory programme and all that went with it served their purpose — Ireland’s renewed prosperity and employment levels are a testament to that.

Today we need to address the needs of current high-value mobile investment.

If any of the remaining industrial units can serve a meaningful purpose in the IDA’s efforts to attract investment, it needs to be identified.

If it is found that the vacant sites are of little use, then the Government needs to look at how best they might be used.

They could be used to boost Enterprise Ireland’s armoury.

The nature and type of companies currently attracted to Ireland are a far cry from those which came to our shores those many years ago.

Manufacturing appears to be fairly low down the food chain.

Information technology and communications firms, financial services and their allied industries are where it’s at, and their needs are much different.

As those entrusted in ensuring that Ireland continues to ensure success at attracting high-value investments, we must ensure that they stay focused and not diverted or distracted by ancient relics from a past.

That’s because the wolves are at the door again.

Taxation policy and the treatment of overseas investment by US companies following the election of President Donald Trump have changed utterly.

Reducing US corporate taxation levels and making it less costly to repatriate offshore profits is a game changer that may reduce the levels of funds flowing into projects in Ireland and the rest of Europe.

The end result will be simple. There will be greater competition than ever before.

Moreover, some of the certainty Ireland had on sovereign tax policies and its relationships with the EU are changing.

There may be some diminishing of support when Britain loosens or cuts its ties with the EU.

Some of these changes are not all for the better.

France and other large countries are making it clear that we need to be more subservient when it comes to how national governments arrange their corporate and online sales tax across the EU.

The so-called Common Consolidated Corporate Tax Base, or CCCTB, will mainly benefit the larger countries.

French president Emmanuel Macron says he wants multinationals to pay more tax where they sell their goods.

There is little doubt that President Macron and some other leaders have Ireland in their sights.

In the past, Ireland had to adjust its low corporate tax rate policies to apply to all companies, Irish-owned and foreign firms had to be treated for obvious reasons the same way.

That was a price of membership of the EU club.

There is a bottom line.

The Government — like never before — has to be on the lookout for developments across the EU and minimise the effects on Ireland’s tax regime.

And it needs to be also vigilant with developments across the Atlantic too and tailor incentives to meet the changing times.


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