Ireland Records Strong Flow of Overseas Investment for First Half of 2021
Ireland has recorded strong growth in inward investment for the first half of 2021, according to figures released by IDA Ireland, the Government’s inward investment agency. Figures released show plans for the creation of employment related to inward investment into the country are close to 2019 figures despite continued business uncertainty caused by the global health pandemic.
To the end of June 2021, 142 investments were won, with associated employment potential of over 12,530 jobs. 62 were new name investments and 80 were investments by established companies. Overseas investment is of huge significance to the Irish economy with approximately 20% of all employment in the Irish state attributable either directly or indirectly to foreign investment.
The latest 2021 updates were provided as IDA published its 2020 Annual Report and revealed that recovery in global foreign investment flows is now underway after sharp declines in 2020, with a return to pre-pandemic levels of global FDI which had not been expected until 2022.
Speaking at the launch of IDA Ireland’s 2020 Annual Report, Ireland’s Deputy Leader and Minister for Enterprise, Trade and Employment, Leo Varadkar said, ‘These are really encouraging results, showing investment in Ireland has remained remarkably solid despite immense challenges over the past 18 months…’
Mr. Varadkar highlighted the many challenges facing Ireland’s continued success in attracting foreign investment including trade protectionism, Brexit and increased competition from other locations.
He said, ‘Despite these very positive results however, many challenges lie ahead. Among them trade protectionism, Brexit, the increasingly competitive global market for FDI and the need to keep pace with digitalisation, disruptive technology, new business models and the future of work…’
Ireland’s 12.5% corporate tax rate has been instrumental in attracting investment including from some of the world’s leading technology companies such as Facebook and Google who have their European headquarters in Dublin. It was one of just nine out of 139 countries that recently voted against proposals to reform international tax. The proposals by the Organization for Economic Cooperation and Development (OECD) included plans for the introduction of a global tax rate of 15%.
Speaking on national radio last week, Ireland’s Finance Minister, Paschal Donohoe denied that Ireland was reconsidering its stance amid reports that the country risked reputational damage should it continue to retain its 12.5% corporate tax rate. Minister Donohoe said the existing tax rate had been a feature of the country’s economic policy for decades and he was ‘committed’ to retaining it.
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