Ireland Economy Turning Green Leaf: IDA CEO
Ireland's economy is starting to turn a green leaf, Barry O’Leary, the CEO of IDA Ireland told CNBC on Wednesday.
“We’re moving on,” said O'Leary, who heads the agency responsible for Ireland's industrial development. “The Lisbon Agenda (a 10 year strategy for economic growth in Europe) is thankfully passed now. We are in the right direction in terms of winning more foreign direct investment.”
The IDA offers funding and grants for those investing in Ireland. Under a new strategy titled Horizon 2020, it aims to deliver 105,000 new jobs by 2014, by attracting and maintaining foreign investment in the country.
O'Leary said the Irish government has taken very decisive action in cutting capital spending and the salaries of public service workers in order to attract investors.
Until recently, Ireland had an unemployment rate below 4 percent, but that figure has climbed to 12.2 percent.
“We had a big construction bubble that accounted for a lot of the employment, and now that’s gone and will not come back so we have to make sure we diversify the economy on a much wider basis," said O'Leary.
Despite Ireland’s rising unemployment, the recession has also brought about positive change for the country O'Leary said.
“One of the great benefits actually out of the recession is the improved competitiveness in areas like construction, land, rent, energy, labor, hotels, restaurants,” he said. “It’s difficult but we are moving in the right direction.”
Although Ireland has been lumped with the so-called PIGS (Portugal, Ireland, Greece and Spain), the Greek crisis has not had much of an effect on the emerald isle, said O’Leary.
“If you look at the bond markets, the ten year bonds and you look at the spreads, we’re much nearer the German one, and we’re in between the German and Greek,” he said.
Meanwhile, Ireland’s IT sector has seen the most growth recently. Hewlett Packard, IBM , Intel , Johnson & Johnson are some of the companies who have recently boosted their presence in Ireland.
A big draw is the country's large talent pool, the track record of FDI, attractive tax rates, technology capability and ease of doing business, said O'Leary. Ireland is also looking to attract more small and medium-size companies.