Better connectivity means a better future - it really is that simple
One good idea blue-sky thinking from business leaders and innovators
Published 18/10/2015 | 02:30
Ireland's economic rebound in the past year has seen the economy expanding by over 4pc, with our global reputation continually improving. Although Ireland is one of Europe's smallest economies, we have emerged as one of the most attractive locations in the world for international firms, especially from the US, to do business.
Ireland's technological connection and interdependence with the rest of the world are key enablers to how it conducts and attracts global business.
To say that the internet and digital market have revolutionised the way Ireland collaborates and conducts business across borders is something of an understatement. While the digital world continues to create ample new opportunities, operating in a global market also introduces new challenges.
I believe there are three pillars that Ireland needs to maintain to ensure it is truly capitalising on international opportunities.
First, we need to create the infrastructure backbone that supports digital and 'born on the internet' companies. Second, Ireland needs to maintain and improve its global internet connectivity. Finally, we need to sustain and improve the nimble business environment, for which we are already renowned.
The American Chamber of Commerce recently estimated that the US accounted for 72pc of Ireland's inward investment in 2014. If you take this down to sector level, Ireland is the second largest location worldwide for US Foreign Direct Investment in the technology sector. By understanding the drivers of US technology companies, we can begin to understand how to create an environment that is an optimum location for technology and digital companies worldwide.
Technology companies may operate in a virtual world where they don't exactly create anything physical; however, everything virtual needs to live somewhere. In the book Silicon Docks: The Rise of Dublin as a Global Tech Hub, published earlier this year, Google cited the availability of a physical location for their data - a data centre - as one of the top reasons for choosing Dublin. More recently, Google announced that it is now one of the capital's biggest employers, with over 5,000 staff at its facilities in Barrow Street.
With data centres playing a fundamental role in the country-selection process of global high-growth tech firms, how do we create an environment that maximises Ireland's chances of attracting tech FDI? As a positive start, Ireland has established itself as a data centre hub for a number of reasons, not least its optimum climate for cooling them efficiently.
Power is another factor. We are attaining 21pc of our electricity from renewable sources and we're on our way to increasing that to 40pc by 2020. The availability of power as a resource is crucial for technology companies and, as a result, the national power grid is a strategic asset for Ireland.
When a company builds a data centre in Ireland, this is a long-term investment that represents a real and enduring commitment to Ireland. This is why it is crucial that Ireland be equipped to cost-effectively meet the power requirements of high-growth tech companies.
The second pillar that will help Ireland to capitalise on international opportunities is that of its global internet connectivity. Recent announcements from Hibernia Atlantic about the new Project Express cable (which links Ireland to one of the fastest transatlantic sub-sea fibre-optic cables), along with new services from transatlantic network provider AquaComms, are significant steps towards new connectivity capacity coming in Ireland.
If Ireland wants to truly succeed as a global internet hub, we need to take into account that, as an island nation, we rely completely on transatlantic connectivity for our European and global reach. In mainland Europe, our counterparts can utilise networks that exist throughout the continent, networks that traverse the whole of Europe.
Despite this, Ireland continues to attract global technology brands to its shores. An abundance of technology companies with a presence in Ireland will develop a critical mass, which will in turn drive improved global connectivity over time.
The final pillar to help Ireland to become more competitive globally is simply to sustain and further improve our agile way of doing business. There are many reasons why Ireland is Europe's second most entrepreneurial country; favourable legislation, low business taxation and excellent entrepreneurial support, all coupled with a brave entrepreneurial spirit.
As a result, the start-up scene is exploding, but to help these businesses really thrive, investment and an investor-friendly environment are also needed.
Moving a business from a start-up to the growth phase needs an early investor. The growth phase leads to jobs created, which in turn creates tax revenue. Hence, we must ask the question, how attractive is it to invest in start-ups in Ireland and to move companies from start-up to the growth phase?
Capital Gains Tax needs to be examined in terms of the effect it has on the investor environment. How does this tax affect the start-ups that need investors and investment to thrive? Also, how is it affecting established businesses, where long-term employees' share-save schemes are often used to attract the right candidates into a business to help it grow?
Business growth is the essential ingredient to Ireland's economy and continued recovery. My one good idea puts a framework in place that creates an environment where Irish companies prosper, where international companies expand within Europe, and where all can grow to help shape a better future for Ireland.
Maurice Mortell is VP of emerging markets and managing director of TelecityGroup Ireland
Sunday Indo Business