Tuesday 12 December 2017

Foreign firms step up interest in a post-Brexit Ireland

IDA chief Martin Shanahan expects decisions next spring. Photo: Mark Condren
IDA chief Martin Shanahan expects decisions next spring. Photo: Mark Condren

Sean Duffy and Charlie Weston

The chief of the IDA, Martin Shanahan, has told the Irish Independent there has been "a massive increase in activity" between the State agency and multinational firms since Britain voted to leave the EU.

Mr Shanahan said many of the firms the IDA was in discussions with had entered a new phase and were in "active mode" when it came to deciding on a new choice of location.

He said companies were sizing up Ireland as a destination because the country could provide a type of certainty to international firms which was no longer available in the UK.

"We have seen a massive increase in activity since Brexit. We've seen increases in all our offices globally," he said.

"That's mainly companies who are now looking at their need to have certain access to the EU which at the moment the UK can't provide them because we don't know what the outcome of the UK/EU negotiation will mean."

The IDA is assisting firms who are taking a more active role in the post-Brexit planning process, he said. He said that process was now at the point of office space identification and employee recruitment for many firms.

"They are now moving to a more tangible phase where they are site visiting, they're meeting with the regulator, they're meeting with us - because it's mainly financial services at the moment - they're looking at their property options in Ireland and they're looking at the availability of talent," he said.

Mr Shanahan said that he expected to see definitive decisions in the first half of next year.

"My expectation is that as we move into the New Year and probably from Q2 on, we will see companies making decisions about what they're going to do in the future. I think many of them will await the triggering of Article 50 and that may dictate some of the timing. But companies are in active mode at the moment in terms of looking at their options," he said.

Last week the Central Bank's deputy Governor Cyril Roux said the regulator had begun receiving applications from UK-based financial firms seeking to move to Ireland post-Brexit.

However, the ability of the Central Bank to do its job has been questioned due to high levels of vacancies at the regulator.

There is a particular shortage of personnel in regulatory areas at the Bank.

At the moment, there are 149 positions that need to be filled.

However, in what is seen as a worrying development, the majority of the positions are in the area of regulation.

Figures obtained by Fianna Fáil's finance spokesman Michael McGrath show that there are 94 vacancies for regulatory posts at the Bank.

High numbers of positions remain unfilled despite the Central Bank's efforts to recruit high calibre staff since the financial collapse in 2008.

Finance Minister Michael Noonan, in response to Mr McGrath, said the Central Bank was "actively recruiting at present, with well over 100 roles advertised".

There are a total of 1,600 employees in Dame Street, but the Central Bank said it hoped to increase its headcount to about 1,800 by the end of 2017.

Elsewhere, ratings agency Fitch warned yesterday that Brexit would hurt the long-term prospects of Irish banks.

Fitch revised its 2017 sector outlook for Irish banks to stable from positive, and said the UK vote to leave the EU increased uncertainty here.

"Brexit is negative for Ireland's long-term economic and political prospects, putting pressure on growth and creating uncertainty around relations with Northern Ireland," analysts said.

Meanwhile, figures released by the Central Statistics Office (CSO) yesterday revealed the deep interdependency between Ireland and the UK.

Last year, Ireland exported over €15bn to Britain, accounting for 14pc of goods sent overseas. The figures showed the Irish beef industry carried the greatest exposure to Brexit, with €2bn worth of meat going to the UK in 2015.

Read more: Councils further ahead than Government on Brexit - expert 

Read more: Creed 'extremely' concerned about UK doing a beef deal with the South Americans

Irish Independent

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