Ireland: Celtic Tiger ruffled but inward investment still flows

But despite being the first country in the eurozone to go into recession, the Republic of Ireland continued to attract significant inward investment in 2008, according to the Industrial Development Agency's review of the year. And the attraction appears to be enduring in 2009, with the announcement on 14 January of five Japanese investments, two of them expansions of existing European headquarters and three in R&D.

The R&D investments are a project by Alps Electric to set up a design team to introduce new technology into the European automotive market; a collaboration between Shimadzu and the Applied Optics Group at the National University of Ireland, Galway, in imaging techniques; and a joint initiative between Sony, Toshiba and IBM to set up a centre at Trinity College, Dublin, to carry out research into the Cell Broadband Engine, the microchip at the heart of the Sony Playstation 3. The centre will be located in Trinity’s Graphics, Vision and Visualisation Research Group.

The Cell Broadband Engine is among the most powerful processors in the world, deploying a multi-core architecture. As well as powering the Playstation 3 it is used in Toshiba notebook computers and a range IBM servers.

In 2008 Ireland attracted 130 foreign direct investment projects worth €2 billion, up 14 per cent on 2007, with the number of companies investing in the country for the first time up by 16 per cent on 2007. There was a 22 per cent increase in research, development and innovation projects.

The Industrial Development Agency’s main focus is on manufacturing, global services (including financial services) and research, development and innovation. Within these areas it focuses on Life Sciences, Information Communications Technology, Engineering, Professional Services, Digital Media, Consumer Brands and International Services.

In 2008 Ireland secured new investment of €420 million in R&D investments, including a €50 million R&D investment at Boston Scientific in Galway. In ICT there was a €29 million R&D investment by Business Objects, a subsidiary of SAP, and an expansion by Synopsis, a supplier of software and intellectual property products, while IBM made three announcements in 2008: the company is to establish an Exascale Stream Computing Research Collaboratory, a new Green Data Centre and a Global Supply Chain Hub. In addition, Europe’s first Cloud Computing Centre was established in Dublin.

The Industrial Development Agency (IDA) said that almost one third of R&D investments involved collaboration with Irish universities, many of which have been supported by Science Foundation Ireland. SFI support is building research capability and capacity to make Ireland a more attractive place to do research.

There are currently around 136,000 full-time employees in IDA supported companies. In 2008 there were 10,044 job losses, accounting for 7.4 per cent of the employee base. But 8,837 new jobs were created, resulting in an overall decline of only 1,207 jobs.