Tuesday 11 December 2018

IDA chief denies cost of housing is slowing investment despite 'Ireland is full' warning

Martin Shanahan, IDA chief executive
Martin Shanahan, IDA chief executive

Gordon Deegan

The high cost of housing is not having an impact on the flow of overseas investment, the chief executive of the IDA has insisted.

Martin Shanahan also claimed the higher marginal rate of income tax for the top earners was also "not as significant a barrier".

And he also stated that President Donald Trump's corporate tax cuts are having no impact on the "pipeline" of investments by US firms.

In an interview at a Shannon Chamber of Commerce event in Dromoland, Co Clare, he said: "The most recent figures for the first half of this year show that investments grew and grew in Dublin."

On the high costs of residential property in Dublin for workers, Mr Shanahan said: "I consider everything in an international context and if you consider other jurisdictions, many of them are facing exactly the same type of issues that we are facing here.

"If you consider that a lot of our investment is coming from the US and a significant amount from the west coast of the US and you look at the relative costs relative to Ireland, they have much more significant issues."

On the shortage of housing, Mr Shanahan said overseas investors viewed the housing shortage "as a short-term issue where they are planning for the long term".

Mr Shanahan said that the alterations to the American tax regime did make the US relatively more competitive than previously, but the Irish rate and regime remained very attractive in a global context.

However his comments on housing were in contrast with reports over the weekend that there was a growing impression that "Ireland is full" when it came to housing.

The warning was issued in a meeting between Minister for Social Protection Regina Doherty and members of the American Chamber of Commerce, according to the 'Sunday Business Post'.

And new research commissioned by specialist regeneration and property developer U+I also suggested that Dublin's housing crisis is seriously hampering efforts by businesses to recruit and retain talent in the city.

Despite a majority of firms saying that well-paid, high-quality jobs were the main attraction to working and living in Dublin, 78pc of respondents said the high cost of accommodation was the single greatest obstacle in attracting talent.

Three-quarters of those surveyed also responded by saying that the limited availability of accommodation was hindering efforts by businesses to recruit new talent, as many young professionals and single middle-income earners have been priced out of the Dublin market.

These findings were even more stark when considered alongside recent Amárach Research which found that the centre of Dublin was at risk of being "hollowed out" and accessible only to high earners.

Irish Independent

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