REMARKS BY PRESIDENT McALEESE AT THE ECONOMIC BREAKFAST, MEXICO CITY 7 APRIL 1999
REMARKS BY PRESIDENT McALEESE AT THE ECONOMIC BREAKFAST, MEXICO CITY 7 APRIL 1999
Ambassador, Ladies and Gentlemen,
I am delighted to have this opportunity to speak to you this morning and I would like to thank all of you – both Mexican business people and Irish people working in Mexico, for taking the time to join me here today.
We in Ireland, as you in Mexico, are very well aware that trade and business are the lifeblood of any country. They are the key factors in creating prosperity, generating employment and providing a decent life for all our peoples. It is important that we value and honour those entrepreneurs who have taken the risks required to succeed in today’s marketplace.
For business and trade to thrive, it necessary to have committed and energetic entrepreneurs. But success requires more than individual dedication. It depends on a wide range of factors within the economy and life of a nation generally and on the economic relationships that exist between that nation and the wider world.
We in Ireland are fortunate that in recent years, those various components, some obvious, some perhaps less so, have come together in an extraordinary synergy that has transformed our country. It is about those aspects that I would like to talk to you this morning, for I know that our experience is relevant and valued here in Mexico, as you seek to put in place a similar transformation.
At a first glance, our two countries are very different in terms of our size, our historical experience, our location within the Old World and the New, yet many aspects of our background are similar. We both know the painful legacy of colonisation, with its lasting impact on both the economy and psychology of a nation. Both our countries were historically poor and rooted in the land, a resource insufficient to support all its people. We each witnessed the loss of generations of our people to emigration.
How has Ireland achieved its current success, with an economy that has grown by almost 40% between 1993 and 1997?
One key factor was undoubtedly the move away from the policy of protectionism in the 1960s, which had characterised our economic and trade policy from the time of our independence, in 1922, up to that date. The opportunities this opened up were greatly intensified by our joining the European Economic Community, as it was then, in 1973. Our membership increased Ireland’s attractiveness as a location for foreign direct investment, as well as opening up a huge new market for both foreign and domestic companies.
Of course it took some time for our indigenous companies, rooted in a traditional dependence on the British and domestic markets, to take advantage of the opportunities this offered. Some of our traditional industries faltered in the new era of competitiveness. But over time, these were replaced by the new high-tech sectors that we targeted, particularly in electronics, the chemical and pharmaceutical industry and, more recently, computer software and international financial services.
Our capacity to succeed in those areas owed much to years of investment in education and training. From the 1960s on, we opened up second-level, and subsequently third level education, to a much wider range of people. Our young people blossomed through the new opportunities this offered, their ‘intelligences brightened and unmannerly as crowbars’, as our Nobel Prize Winner for Literature, Seamus Heaney, described it. New horizons opened up for them, horizons that for many of their parents had been an impossible dream.
It is important to emphasise that this educational policy followed a very specific direction. We targeted science, information technology, business studies, electronics - those areas that would provide us with a highly skilled workforce. This factor, together with our location as the gateway to Europe and to the largest market in the world, proved crucial in attracting foreign investment in those very areas. For example, we now receive 28% of US direct investment in Europe. In all, more than 1,100 overseas companies have located in Ireland. I know that here in Mexico, as the top destination in Latin America for foreign direct investment, the presence of multinationals has also been highly significant.
Foreign investment, however important, can not by itself sustain an economy. The same factors that attracted multinationals to Ireland’s shores – a highly educated workforce, access to the European market and supportive business policies - have also contributed to the growth of a vital and thriving indigenous business sector. But there is perhaps one other factor that has been a significant driver of success for our indigenous business sector. It is the level of confidence and self-belief that we in Ireland now possess as a nation, in our culture, our heritage, our traditions.
For many years, particularly as a result of our colonial past, we lacked that sense of pride in ourselves, in our language, music, dance, literature and traditions. We compared ourselves to Britain and to the outside world, and valued their modernity and culture more than our own. Our membership of the European Union was a significant factor in changing that. It provided a showcase in which our distinctive culture and traditions could be displayed. We found, to our surprise, that we were admired for the very distinctiveness and uniqueness of that culture. That admiration reflected back to us and generated a sense of pride in what we possessed. It has played a role not only in the world-wide success of Irish writers, dancers, musicians and artists but also, I believe, in contributing to our current economic success - the sense that we can compete and succeed among the best in any forum.
We have gone out into the world, with that confidence, and become, on a per capita basis, the third largest exporter in the world and the second largest exporters of microchip technology. Companies which at first began to trade and invest in Britain, broadened their horizons and have developed substantial trading links with the rest of Europe, the United States, Asia and Latin America. The Double Taxation Agreement between our two countries, which came into force at the beginning of the year, indicates the importance which we in Ireland attach to our economic relations with Mexico and the potential for Irish investment here.
This potential has already been recognised by a number of Irish investors who have established a presence here, notably Jefferson Smurfit, the Kerry Group and Independent Newspapers. Mexico has also been a field of activity for consultancy companies such as ESB International, Telecom Eireann and CIE Consult. Indeed, Mexico is our largest trading partner in Latin America, and one which is constantly increasing in importance. In the latter half of the 1990s, our exports to Mexico grew by 38% and our imports from Mexico have increased almost seven fold in the same period.
Those trading links, our understanding of the importance of forging networks and connections overseas, have been mirrored and supported by the development of partnership and consensus within Ireland. Through the process of social partnership, and a succession of national agreements between the Government, employers and trade unions, we have been able to control public expenditure and reduce Exchequer borrowing. Social Partnership has enabled us to achieve, by consensus, a high degree of labour market flexibility and a range of effective industrial and economic policies which have supported a business culture within Ireland.
Those strategies have been at the heart of the economic transformation of Ireland. They have generated prosperity and employment. They have halted, indeed reversed emigration. Many of those who emigrated have now returned to our shores, bringing with them the skills and experience to contribute further to our success. Those who remain in the countries in which they, or their parents or grandparents, put down roots, now comprise a global Irish family in every part of the world. Through their goodwill, friendship and support for Ireland, our legacy of emigration has become a strength rather than the tragedy of former years. It is a phenomenon which I hope and believe will one day also arise in the case of Mexico, which today continues to see so many of its people leave its shores.
It is important that we in Ireland use our newfound prosperity wisely, that we spread the opportunities it has created. That we tackle the poverty that still exists in our country, and enable those for whom our success seems very distant from the harsh reality of their own lives, to share the benefits. That is not only the decent thing to do, it makes clear economic and social sense. Our experience has proved that a country which utilises only part of its human resource, can expect to reap only half the potential. The more people who are given the education, skills and confidence to take up employment and escape the poverty trap, the greater the resource we have at our disposal, the greater the release of new energy and new talent.
This approach has a value beyond our shores, both within other countries and in terms of the relationship between the most prosperous and least developed parts of the world. It is in all our interests to promote and assist development; to create a world in the next millennium in which inequality and poverty within and between counties is finally tackled once and for all. I wish Mexico, in particular, every success in its continuing efforts to realise its full potential and that of its people. I congratulate all of you on your role in ensuring that this is the case.
Finally, I would like to thank you once again for joining me here this morning. I wish you all the very best in your own enterprises and activities in the years ahead.