CEO of IDA Ireland Barry O’Leary says that the country has an advantage over other sovereign debt problem states because of its well educated workforce and low-corporate tax rate of 12.5%.
IDA Ireland, an organisation with a 40 year history of bringing foreign direct investment to the country, has a clear agenda, but it also has a point.
Ireland has aggressively targeted companies like IBM (200 new jobs), Google, and Citi for job growth during the recession, a “different portfolio” of businesses than other PIIGS states, according to O’Leary.
And while Ireland’s construction industry, and banks which supported it, has been crippled, its effective nationalization of bad assets could lead to a swifter cleanup of the problem.
O’Leary explained that Ireland’s growth is “export led,” which means many of the aggressive measures Ireland has undertaken, like cutting public sector pay 6-30% since 2008, won’t hit tax returns too heavily.
But the reality is, Ireland is relying on the global economy continuing its growth trend. If China is to slow, and Europe is to double-dip, the country’s limited tax returns could force another debt crisis much worse than this one.