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FDI is Not the Answer

The Irish Examiner reports that jobs created by foreign companies plunged 45 percent last year according to an Ernst and Young survey. This means that Ireland has dropped to tenth place (drop of one place) in the rankings of attractiveness as a location for investment in Europe in 2009. This equals to a 3 percent share of FDI jobs in Europe, and 40% of these are tech and financial services jobs. To be honest this post could appear on some of the other Ryan Academy blogs as well as the Green one.

The simple fact is that no matter how good the IDA Ireland people are (and they are), FDI and foreign companies are not going to fill the construction-sized hole in the Irish economy. What we need is innovation, creativity and enterprise development. In particular we need to ‘mine’ the vast potential of the green and sustainability resources this Island has. If we had oil or precious metals, there would be wells and mineheads all over this Island. Yet we have vast potential in wind, wave and biomass power and we still buy in the majority of our energy needs in terms of carbon products such as oil, gas or coal.

What can we do? Well, some form of fund and the necessary financial instruments to help incentivise organisations (starting with the councils and semi-state organisations) to put in energy-saving schemes and allow them to generate their own energy. We need to lead with innovation in thinking and doing. Dundalk Institute of Technology is a good example of this, but we need it more and bigger. The schemes so far haven’t had the ambition level. There is a good cost/benefit analysis that needs to be done to prove this. We have to stop sending our money overseas.

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  1. Tara
    June 17, 2010 at 08:46

    Is it all down to the funding and financial levers we use? Which ones would bring the best value for money? Grants or loan guarantees?

    What about the role of education and re-skilling? For example in the UK and Norway, the offshore oil and gas employees are well suited to transfer over to offshore wind and wave industries.

    • June 17, 2010 at 23:13

      Hi Tara

      You are absolutely right – I was just honing in on the lack of movement in ‘big ideas’ for the green economy in Ireland. I think education is vital and I think that the higher education system is finally moving in that direction, as is vocational training and hopefully Fas will continue to develop such courses. But there is no point in training them if there isn’t cash out there (or tax incentives) to ensure that we start moving away from a carbon based economy. I have said ‘some done, more to do’ but we really need to get some big ideas out there. I don’t have all the answers but I think together there are a lot of us that can help move this debate to action. Thanks for your comments.

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