Attracting Foreign Companies
Ireland has increased its GDP at an incredible rate over the past few years, bypassing Euro neighbours even though it has suffered from slow growth, high unemployment, high inflation and very large public debt.
The reason for this rapid change are multinational companies settling in Ireland, which provided them with schools, low-cost and well educated workers, logistic infrastructure and a low-tax regime. With Apple being one of the first settlers in 1980, others, such as Intel (1989) and Amazon (2005), were quick to follow.
By 2016, one out of five Irish workers were employed by a foreign multinational company. Without these jobs, the unemployment rate in Ireland would have been around 23 percent. By now, Ireland has about 300 foreign biopharma companies, which have partly been encouraged by the Industrial Development Agency (IDA) to establish their operations in Ireland. The pharma sector makes up over 50 percent of all exports and supplies well-paid, skilled jobs.
One of the main reasons for the large amount of foreign direct investment in Ireland is its indispensable favourable tax regime. This was possible because Ireland had no domestic industry that could be hurt by multinational companies. As a result, Ireland experienced trade surpluses of 14 percent of its GDP from 1995 to 2014.
Another reason is the demographics in Ireland, as it has a very young population and one of the lowest proportions of over-sixty-five-year-olds. Additionally, female participation in the workforce is above average. The main benefit of such a young population is the increase in mobility of the workers.