Over 1,200 companies have chosen Ireland as their base to serve the European market and beyond. Here, these companies find a favourable tax environment, competitive operating costs and a productive and flexible workforce. These factors together ensure the highest returns on investment for companies choosing to do business in Ireland.

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• The Irish Model
• Economic Statistics
• Trade Statistics
  • Exports/ Imports of Goods and services
  • Exports by sector
  • Destinations of exports
• Demographics & Workforce
  • Population by age group
  • Employment by sector
  • Future availability of workforce
• Labour Costs
  • Hourly compensation costs US$
  • Output per person and unit wage costs
  • Regulatory environment
• Education
  • Public spend on education (OECD)
• Infrastructure
  • Logistics
  • Telecoms
  • Electricity
  • Water
  • Facilities
• Taxation

Many commentators view Ireland’s recent experience as a case study in successful economic development. One notable feature of the ‘Irish model’ is the establishment of a consensual partnership for managing the economy, involving Government and the social partners. This has contributed to industrial peace, moderate wage increases, progressive tax reductions, and sustained job creation. Ireland’s social partnership model, and the intelligent manner in which EU Structural and Cohesion Funds have been deployed, are increasingly being emulated across the European Union. Other components of Ireland’s recent development are:

• A commitment to full EMU membership
• Steadily increasing levels of export growth
• Substantial inflows of high technology inward investment
• A stable pro-business government environment
• Strategic investments in social and physical infrastructure
• Above all, a new confidence in Ireland's people and their capabilities

A compelling measure of Ireland’s new international competitiveness is its exceptional growth record, unrivalled not only in Europe but anywhere in the developed world. Over the past six years, Ireland's economic performance has been spectacular (International Monetary Fund, 2000). No other OECD member country has been able to match its outstanding performance. Real GDP growth has averaged over 9.24% per annum in the period 1996-2000.

Gross Domestic Product statistics

Source: OECD Economic Outlook June 2000, The MD’s World Competitiveness Yearbook 2000

A major contributor to Ireland’s record growth has been the level of foreign direct investment. 1200 overseas companies now operate in Ireland, accounting for

• 48% of the manufacturing workforce
• 70% of industrial exports.

Source: Central Statistics Office, December 1999

Components of Exports January - April 2000

Source: Central Statistics Office, External Trade June 2000

Destination of Exports

According to the latest estimates from Ireland's Central Statistics Office, Ireland's population is 3.744 million. 40% of the population are under the age of 25 years.

Population by Age Group April 1999
(000's) (estimates)

Future Availability of workforce Percentage population under 25 in the year 2010

Source: United Nations

At work by NACE Economic Sector '000

Ireland has one of the best education systems in the world according to the 1999 independent IMD World Competitiveness Report. Almost 1 million people are in full time education. 60% of school leavers go on to third level education. The majority of these undertake courses in business, engineering and computer science.

Some Comparative Educational Data Public Expenditure on Education as % of total Public Expenditure by level of education.

Ireland has a competitive wage environment. A series of inter-sectoral wage agreements between employers and employees ensure that wage inflation is low. Statutory add-on costs are one of the lowest in Europe. A recent study of salary costs in Finance & Administration shows Ireland to have the lowest costs in all job categories of the 5 European locations surveyed.

Total Hourly Compensation costs in US$
for production workers in Manufacturing

Output per person and unit wage costs in Manufacturing Industries (1985-1999)

Source: US Department of Labour, 2000

Employment legislation in Ireland governs a few crucial and basic areas. Maximum hours of work for industrial workers are set at 48 hours per week plus 12 hours overtime but, in practice, the average is 39 hours per week. Statutory leave has been increased gradually over the last number of years in Ireland and now the statutory minimum is 4 weeks per annum.

Ireland has invested US$5 billion in the telecommunications infrastructure over the last 10 years and offers a reliable fully digital telecommunications system. The telecoms market in Ireland is currently under-going major changes. The market was deregulated over a year ago and this has resulted in the entry of many global players into the Irish market. Some of the major players include MCI/Worldcom, Eircom, BT/Esat and Stentor Communications. In general these service providers tailor their prices to the individual needs and requirements of their client. The following tables contain sample pricing only.

Comparison of the Cost of International Calls 100-line Business Customer (average cost per call minute before discounts in (US$)).

Electricity
The ESB is the national provider of electricity in Ireland. They operate 24 power stations nation-wide, which have a total capacity of 4164 MW. Electricity supplies are provided through a national grid comprising high voltage 110kV, 220kV and 400kV lines. Adequate supplies are available to meet any major industrial demand at any location within the country. Industrial users are principally supplied at 110kV or 38kV (high voltage) or at 20kV or 10kV (medium voltage). Low voltage supplies are also available at 230V.

International Industrial Electricity Prices (pence per kilowatt hour)

Water
The cost of metered water for industrial use in Ireland varies by county. In addition, most local authorities have a charge for meter rental. Again this varies with most charging below £100. Some local authorities also have a minimum charge.

International Cost of Water (Pence per Cubic Metre) 1999

Source: National Utility Services Ltd, International Water Price Survey, 1999

Ireland’s Industrial Development Agency (www.idaireland.com) works in partnership with the private sector and local authorities in Ireland to ensure that fully serviced, competitively priced land and buildings are available for industrial and commercial use. In addition, local authorities and private developers own a large number of sites.

Comparitive Total Office Occupation Costs (US$)/annum per sq. ft.

Source: World Office Rents, CB Richard Ellis, UK, July 2000

Logistics
Ireland has the highest density of roads in the world (road kilometres per million inhabitants). 90% of goods for export are delivered to Ireland's seaports and airports by road. Substantial investment has been made in upgrading the roads network in recent years. Seaports handle three-quarters of Irish trade with the rest of the world, between roll-on/roll-off ferries and lift-on/lift-off container ships. Services are provided by the largest and fastest ferry vessels in Europe. Eleven regional ports handle mostly bulk traffic. By the end of the 1999, more than IR£230 million will have been invested in modernising Irish ports, with the aim of increasing freight capacity and reducing costs for exporters. International airports at Dublin, Shannon and Cork handle over ten million passengers and 125,000 tonnes of freight every year. Direct daily scheduled services are available from Ireland to European and North American destinations. Internal passenger and helicopter services are provided using a network of six regional airports.

Taxation

Ireland offers one of the most beneficial corporate tax environments in the world. Profits derived from eligible manufacturing and qualifying services are subject to a tax rate of 10% until 31 December 2002. From 1 January 2003, a corporation tax rate of 12.5% will apply to trading profits in all sectors, including manufacturing and international services. The tax position of companies carrying out approved activities prior to 31 July 1998 will remain unchanged.