ADDRESS BY THE PRESIDENT OF IRELAND, MARY ROBINSON, AT A LUNCHEON HOSTED BY MR. DON ARGUS
HOSTED BY MR. DON ARGUS, CHAIRMAN, NATIONAL BANK OF AUSTRALIA,
I am delighted to be here today as the guest of Mr. Don Argus of the National Bank of Australia and I greatly value the opportunity to meet and address leaders of Australia's business community. We in Ireland are anxious to foster closer economic links between Ireland and Australia and it is my hope that my visit to Australia will give you a better understanding of the modern Ireland and help to strengthen and increase the links between our two countries.
Economic conditions have improved dramatically in recent years in Ireland - our GDP growth has averaged more than 5% each year for the past 5 years - well ahead of the EC average. Inflation has come under control with a present level of 2.8% in the year to August, one of the lowest in the EC. Exchequer borrowing will be just over 2% of GNP this year with further reductions foreseen.
However, the huge expansion in the Irish labour force has resulted in a very high level of unemployment and the reduction of the unemployment level has become the principal focus of Irish economic policy. For this reason you will, I am sure, appreciate our desire to continue to attract foreign investment to Ireland as a means of addressing our unemployment problem.
The fact that more than 1000 overseas companies, employing some 90,000 people or 40% of manufacturing employment, are now active in Ireland attests to the advantages that we have to offer. Given the intense competition for mobile investment, our success rate in attracting investment is remarkable and constitutes a resounding vote of confidence based on performance rather than sentiment.
In furtherance of the policy of encouraging foreign investment particularly attractive incentive packages are available to investors and Ireland now yields one of the highest rates of return on foreign investment. Australian companies who invest in Ireland can also look to other advantages such as our common language and similarities between our company law and banking system. With the advent of the Single Market next January Ireland will be an ideal location for access to this rich market of 345 million people. And of course, we have a young, dynamic and innovative workforce. Irish graduates are recognised as among the best in the world and the resource that our young people represent is the major factor that differentiates us from our competitors and makes Ireland the natural location for technology based industries.
The establishment of the International Financial Services Centre in Dublin will, I am sure, be of particular interest to you. It was set up in 1987 primarily to generate quality employment by taking advantage of the worldwide growth in demand for such services. Incentives available include the application of Ireland's 10% corporation tax rate to activity at the Centre.
Already, over 200 world-wide companies have been approved for the Centre with 140 already in operation.
As you will appreciate we attach a very high priority to the continued development of a favourable business climate in Ireland in order to facilitate the expansion of trade and investment. We are a very open economy and vigorously support a free trade policy. Trade and especially in our case a vibrant export trade are the lifeblood of the Irish economy. Exports account for over 70% of GNP and imports for over 60% of GNP.
The performance of Irish exports in recent years has been one of consistently high growth. However, trade between our two countries is modest and does not reflect the potential of both economies. I know that earlier this year your Prime Minister in his "One Nation" statement highlighted a number of trade and trade policy related measures to boost exports.
Indeed, Australian companies anxious to sell into European markets can also benefit from arranging alliances with Irish companies. I am keen that Australian companies are alerted to the attractions of setting up marketing partnership arrangements with Irish companies. I would like to stress here that I think Ireland is ideally poised to act as a gateway to Europe for Australian companies either through the formation of marketing alliances with Irish firms or through the establishment of their own European bases in Ireland.
I am pleased to say that the last few years have seen a substantial improvement in investment in both directions between Ireland and Australia. This growth in investment has occurred since the mid 1980's, as companies in Ireland and Australia have sought to internationalise their operations. Australia is very much part of the Asia Pacific region, an area which has experienced the fastest growth rates in the world. The economic dynamism of the region, coupled with the long-standing associations between Ireland and Australia, make Australia a particularly attractive area for Irish investment. We have seen Irish investment here in the communications, natural resources, advertising, airline, agricultural products and bloodstock industries.
The primary example of Australian investment in Ireland is, of course, the National Australia Bank's purchase of the National Irish Bank. I would like to congratulate National Australia Bank, as I understand that the company has been designated "Bank of the Year", an award which is fully deserved. I have been especially impressed by the interest shown by the National Australia Bank in Ireland. You, Mr. Argus, have demonstrated an interest in the business possibilities offered by Ireland. I would also like to mention Jim Lacey, who came to visit me a short time ago at Åras an Uachtaráin and whose mammoth work in Dublin has been instrumental in the success of the Irish arm of your operation.
It is my hope that more Irish and Australian companies will seize upon the example of the National Australia Bank and diversify their interests in an international setting. The old Australian slogan of the post-war period "populate or perish" can now be changed to "compete internationally or perish". In an ever more competitive international economic climate, only the strongest and most dynamic companies will succeed. I hope that, through the close business links between Ireland and Australia, the most successful companies may be of Irish or Australian origin.
Unfortunately, my tour to Australia is drawing to its conclusion. My trip has been rich in experience, providing me with a bounty of happy memories from which I will draw in the future. I will look back with great fondness on my visit to Melbourne and, especially on the kind hospitality of my host, Don Argus. I can only, in return, offer a simple word of thanks. As we say in Irish:
Gura míle maith agaibh go léir - thank you a thousand times.