ADDRESS BY THE PRESIDENT, MARY ROBINSON, AT DINNER FOR BUSINESS REPRESENTATIVES IN MANCHESTER
ADDRESS BY THE PRESIDENT, MARY ROBINSON, AT DINNER FOR BUSINESS REPRESENTATIVES IN MANCHESTER ON 18TH APRIL, 1994
It is with great pleasure that I welcome this distinguished gathering of business people from the North West of England this evening, given the strength and vitality of the economic relationship between Ireland and this region. I felt that a visit by the President of Ireland to Manchester would be incomplete without meeting a representative group of business men and women who play such a vital role in the economic welfare and daily lives of our peoples.
The very close ties between Ireland and the North West of England derive from and are underpinned by economic interdependence. The very evident involvement of Irish people in the fabric of life in this region is a manifestation of the strong economic links between us. Historically one could say that the trade and labour flows were essentially one way, that is from Ireland to the North West of England, an unequal partnership. This is no longer the case. Right through the areas of investment, commerce, tourism, trade, financial services etc., a dynamic interaction now takes place.
But what is the reason for this economic partnership and why does it grow stronger? The fundamental reason for the greater balance in the economic relationship is the very impressive performance of the Irish economy over the last few years. It is worthwhile looking at some of the highlights of last year:
- Growth in the region of 2½% compared with an estimated decline of ½% for the European Union as a whole; we are looking at 4% for this year and the prospects to the end of the century are equally encouraging;
- inflation at 1½%, the lowest since 1960 and less than half the EU average;
- an Exchequer borrowing requirement at 2½% of GNP, below the target of 3%, and again less than half the average for the European Union;
- building society mortgage rates at their lowest levels for at least 25 years and wholesale interest rates lower than they have been since 1979;
- balance of payments strongly in surplus;
- wage inflation low, stable and below the European average.
Given the unfavourable international background that prevailed for most of last year, this performance was impressive by any standards. Nor was this the beginning of a trend but rather the continuation of an improving economic performance going back many years.
However, despite the progress we have made the one key factor that remains a blight on an otherwise positive landscape is that of unemployment. But it is encouraging to know that we have at least reversed the European trend in 1993 and increased employment levels.
In terms of investment, there are now over 1,000 overseas owned manufacturing and international service companies located in Ireland. The decision by such a large number of companies to locate in Ireland, despite fierce competition for international mobile investment, shows that the benefits of locating in Ireland were convincing for them. Our 10% corporation tax rate, our highly educated, motivated, young computer-literate workforce, and a first class telecommunications network are just some of the attractions that we can offer. They are why there are now over 160 UK companies with direct investments in Ireland.
One of the most recent initiatives is in the area of international financial services where we have established the Dublin International Financial Services Centre. Some of the world's largest banks and insurance companies have located here to take advantage of the EC approved 10% tax rate.
But, as I said, this is not one-way traffic. A growing number of Irish companies, having traded successfully first with the North West and then throughout the UK have now taken the next stage in their corporate development and have expanded their operations by way of direct investment here. There has been a noticeable growth in the number of UK investments by, for example, our large food companies.
Trade flows also demonstrate the dynamic economic interaction between us. Almost one-third of our total exports go to the UK market. However, what is remarkable is that we are, at the same time, the UK's seventh largest export market and buy more goods and services from the UK than the whole of the African Continent, Australia and South America combined. While we run a considerable trade surplus with the rest of the world, we actually have a trade deficit with the UK.
Many traders in Ireland and here in the North West now regard each other's markets as home markets such are the similarities in our business cultures. It is through learning to trade with this region that very many Irish companies developed the skills and gained the confidence which enabled them to trade internationally. By intensifying and diversifying the trade between us we, in effect, establish a self-contained and broader "home market" which can withstand the intense competition from abroad.
And this trade is not just in goods. Of growing importance is the trade, in both directions, in expertise and new technology. There are great similarities in our business cultures, in our attitude to work and in our commercial legislation. At the forefront of the major technological changes in both of our countries are partnerships and alliances between our energy companies and those in the UK. For example, North Sea Gas can now be piped through Scotland and into Irish homes and businesses. Our national power generation company has secured major contracts in various aspects of electricity generation and transmission (including direct investment) as well as working for British Rail, the Channel Tunnel and London Underground. There are extremely close ties between our telecommunications companies. Where not so very long ago we would have had to buy in UK technology, we are now a source of expertise and support which is in strong demand.
Probably the most visible element of economic activity between us occurs in the biggest industry in the world, namely tourism. 1.8 million people from the UK visited Ireland last year, an increase of 5%. Alone, these visitors are estimated to support about 25,000 jobs in Ireland.
In the past five years Ireland has invested upwards of £1 billion in its tourism industry. This investment has gone to produce many new facilities and attractions and to improve and enhance existing ones. This is an ongoing process and more and more resources are being allocated for this purpose. To complement its many natural advantages - the genuine warmth of its people, its unspoiled rivers, lakes and countryside, its low density population - Ireland now offers the full spectrum of leisure activity from golf to angling to water-sports and equestrian activity. It is the ideal venue too for conferences and meetings - some of Britain's best known companies have held their conferences in Ireland, availing of the modern facilities while leaving time to pursue leisure interests, which are well catered for in an industry that recognises the need to provide specialised holiday programmes to suit many tastes.
The scale of the movement between Ireland and Britain is best illustrated by the fact that 8 million passenger movements take place annually and, at the height of the holiday season, 9,000 airline seats and over 8,000 car ferry spaces are available from Britain to Ireland daily.
This evening we have with us the most senior representative of some of Ireland's most dynamic Semi-State companies. They operate in the areas of trade, tourism, manufacturing and financial services investment, air transport, and power generation and transmission. I hope that this occasion will provide them and you with the opportunity to foster even closer links to mutual advantage.
One of the many bodies formed to further the business environment between Ireland and England is the British Irish Industry Circle, founded in London in 1988 under the joint auspices of the CBI and its Irish equivalent, IBEC. The Irish Ambassador to Britain and the British Ambassador to Ireland are joint patrons. In 1992 the North West branch was formed and is now actively developing its role in the region. I am pleased that the BIIC is strongly represented here tonight.
If the need for economic co-operation between our two countries is obvious, the need for continued political co-operation is even more apparent. We are only too painfully aware of the consequences of the ongoing tragedy of Northern Ireland. The loss of life and destruction of property has hit both our countries. Manchester and most tragically Warrington have recent experience of this. When I attended the memorial service in Warrington last year, it brought home to me even more pointedly than ever the futility, the horror, the intense human tragedy that follows from violence of this kind.
Let me conclude by wishing everybody here success in their business, whatever that might be. Your personal success generates the wealth and activity necessary to sustain our peoples. We are inextricably linked. Your success is our success.