Yesterday’s announcement of IDA Ireland’s new 5-year strategy put considerable focus on the regional balance of future FDI investments.
The strategy includes a target to increase the number of investments in every region, outside of Dublin, by 30-40% over the lifetime years of the strategy. With Dublin maintaining a similar level to currently. For example for the West, which received 71 investments over the 2010-2014 period, the target is to achieve 92-99 investments over 2015-2019. For the Border region the target is 61-66 investments (it received 47 in the past five years). These targets do not just refer to new name investments, but include expansions by existing FDI companies and R&D investments.
The record in achieving regional FDI investment targets to date has not been particularly good and it is interesting to note the IDA states that it sees these regional FDI targets as ‘… collective targets for the stakeholders in each region to work together to achieve’. Together with considerable emphasis on the role of the upcoming Regional Enterprise Strategies (or Regional Action Plans) being prepared by DJEI, there seems to be more focus on the role of other actors in attracting FDI.
It has been highlighted elsewhere that Local Authorities, with their increased economic and enterprise development remit through the LEOs, could become more active in targeting smaller scale FDI opportunities, including through county diasporas.
In setting out how it plans to deliver on these targets, IDA Ireland refers to developing sectoral ecosystems in the regions by aligning IDA business sectors with regions and their strengths as well as working more closely with EI to maximise clusters and linkages with indigenous businesses. The €150m investment in property solutions in various locations, including Sligo, Castlebar and Galway in the Western Region, announced a few weeks ago, seems to be viewed as a key element in achieving the targets.
As we highlighted in our analysis of agency assisted employment, recent agency assisted jobs growth has been driven more by the foreign owned sector in the Western Region than in the rest of the state, largely because of the weaker performance of the region’s Irish owned assisted sector. Efforts to achieve the regional FDI targets hold particular importance for the Western Region.