Foreign Direct Investment and Ireland’s Tiger Economy

During this essay I will compare the difference of economic and policy development of Ireland, north or south in relation to the United Kingdom. As of today Ireland themselves are bit more advanced, exchange secondary economy. Ireland was among the starting gathering of 12 EU countries that started streaming the euro on 1 January 2002 “Although Ireland had aspirations to become a member of the Community as far back as 1961 it was not until 1972 when a referendum confirmed Ireland’s entry into the European Community with 83 per cent of voters supporting membership. Ireland formally acceded to the then EEC in 1973”. (Loughran, 2015).

By the early 1900's the Irish had achieved remarkable economic success, reaching approximately the same occupational levels

Ireland began to have civil rights activists that they had been protesting against discrimination against Catholics and the Irish nationalists by the government of Northern Ireland. As for the civil rights movement called for people to vote to see whether the end of discrimination would come to an end. There also where an overwhelmingly protestant police force who were always known for being hard on the Catholics. However Irish people continued to emigrate during the 1950’s and 1960’s. As the 1970’s came around Irish economy grew by 4%. (“Global World Warrior”).

First of all the population of Ireland is 4,618,000 and the area of Ireland is 27,133 square miles. The landscape in Ireland is consisted mostly of farms, plains, and low mountains. In Ireland most of its industry or business is Agriculture. The thing that is mostly grown in Ireland is potatoes. The population of Ireland is about 4,618,000. According to school.eb.com “About three fifths of Ireland’s population is urban. The capitol, Dublin, is an affluent city whose metropolitan area is home to more than a quarter of the country’s people.” Ireland has a very fascinating history.

For example, Ireland lowered its corporate tax rate to 12.5%, which got the economy booming. The country’s gross domestic product rate grew at a rate of around 26.3%. Ireland’s low corporate tax rate attracted successful foreign companies to invest in Ireland. For example, American companies such as Microsoft, Google, and Apple all have subsidiaries in Ireland to take advantage of Ireland’s low corporate tax rate (Semeuls). However, the low corporate tax rate was not the only reason the country had flourished. There were several other factors that helped boost Ireland’s economy. One of them included Ireland joining the European market in the 1990s, which allowed goods to flow freely across the countries in the European Union. Soon, Ireland became an entry point within Europe and large corporations started to use Ireland to manufacture goods and sell the goods to other European countries without the attachment of any tariffs. In addition to Ireland joining the European market, Ireland attracted many corporations to its country because it was primarily an English speaking country. This helped in the ease of communication between the Irish government and the foreign corporations. Another factor that helped boost Ireland’s overall economy was that the Irish government passed a number of educational reforms which led to a significant number of educated graduates that came out of Irish schools (Semeuls). In the 1990s and 2000s, Ireland became a highly attractive country for international companies because it acted as an easy trade center within the European Single Market. Therefore, the low corporate tax rates was not the only reason Ireland’s economy boomed, but also a combination of factors, which was very specific to the country of Ireland and that could not be copied by other countries, all came together to

When most people in the world think of Ireland, they imagine green fields with farm animals, old cottages, stone walls, rocky roads, people riding around on horse-back and men working in the bogs. However Ireland actually has one of the quickest fastest economies in the world. Rural Industrialisation played a huge role in this growth. Industrialisation is a very important part of Irish history. It was a new beginning for the Irish people living in rural areas and it created a change in gender composition within the labour force. Women were

While the country did, at the time of the Celtic Tiger, benefit from direct foreign investment

Ireland in the second decade of the twentieth century was a place of contradictions, enjoying more prosperity in some ways than it had under previous decades of British rule, but still chafing under this rule and agitating for independence or for governmental and social reform in a variety of areas (Ferriter, n.d.). With a concession for home rule made by the British in 1912 but actual implementation halted with the outbreak of the First World War, Ireland was in a position of uncertainty, with more jobs because of the war but with less optimism for the future in many ways (Ferriter, n.d.). Still not really seen as a land of many opportunities, immigrants from Ireland to the United States and other places in Europe sought better jobs and more stability.

FDI allows the home country to invest into the host country to produce, advertise, and distribute products, in order to upsurge their market share and provides a long-term investment and enhancement. (Moosa, 2002)

The Irish government took a huge risk by saying goodbye to the protectionist policies that had been in place in the country for many years. Deciding to view the world as a market was a risk, considering it went against the policies that led Irish people to believe they had a fraction of control over the state. The risk paid off, with the government attracting Transnational Corporations into the rural regions of Ireland through incentives and grants. The industrialization of Rural Ireland transformed Rural Society. Rural Ireland, once a region occupied by agricultural enterprises, now became the home of many manufacturing factories and the region had slowly begun to urbanize due to the increase in Transnational Corporations in the region. Although there was conflict along the way, as can be seen by the conflict that emerged due to a fear of pollution, this industrialization transformed the life of the residents. Women were now given “financial independence” as they earned their own individual incomes for the first time. They had escaped from the invisible handcuffs that locked them to their homes. These women now had a new, distinguished source of power that enabled them to form their own community ideology. A boom took off in the rural regions of Ireland, with more employment opportunities. Migrants returned home to take advantage of these opportunities and the rural

Now for the economic outlook of these two countries. This comparing, and contrasting segment is more difficult than the political outlook. Since, these two countries do vary quite significantly in terms of population and size. For instance, Ireland’s population as of July 2016 was just below five million, which is incomparable to the roughly 324 million United States population (“The World Factbook: IRELAND”, 2017, Pg. 1). That means the Irish population could be added about 65 times to reach the American population. However, these two nations do have some similarities. First, both countries rely heavily on technology to propel their economic growth and expansion. For Ireland has a “talented pool of high-tech laborers” and

This paper goes over a brief look into the Republic of Ireland’s history, economy, their culture, and their

Perhaps that had a slight impact, but that does not correlate with the strong economic growth in Ireland in 2015. For example, its almost been twenty years since Ireland joined the European Union and much of their economic growth happened after they lowered the corporate tax. According to Trending Economies, the European Union, itself, only grew a little above 2% in 2015, meaning Ireland represents an outlier in that Irelands economic success was not due to the European Union, but instead represents what happens to an economy when corporate tax rates are low.

Ireland has been know to be a hugely attractive for FDI, especially during the 1990s. While Ireland hasn’t been able to compete with countries like the United States in the amount of FDI it attracts, “relative to the size of the economy” Ireland has attracted very high levels of inward FDI (Bailey and Lenihan, 2015). In particular, Ireland has attracted significant United States FDI (Kelley, Glenn, & O’Brien, 2007, p. 2; Rios-Morales & Brennan, 2007). “In 2009, in 64% of FDI in Ireland was sourced from the US and 28% from Europe” (Department of Enterprise, Trade & Innovation). Furthermore, a report by the Department of Jobs, Enterprise, and Innovation (DJEI) stated that, in 2014, “89% [of Ireland’s exports] came from foreign-owned firms” (2016). Overall, FDI is an important part of Ireland’s economy (DJEI, 2010). But why has Ireland attracted so much to foreign investment? Ireland’s success in attracting FDI has been based on a combination of interconnected factors, most notably their FDI promotional strategy, investment in education, membership in the European Union, and low corporate tax rate, that have helped to develop a good investment climate.

This paper will begin by examining the two important factors, exports and imports, for the reason that they are central to understanding the effects from joining the EU. Ireland has an economy that is inherently centered on the difference between imports and exports, in other words; its terms of trade. The more units of exports that can be used to purchase a unit of imports, the more economic stability the nation displays. Ireland’s EU membership and its adoption of the euro initially facilitated a high level of imports from other nations within the Eurozone, because the single currency and open market access led EU nations to trade freely with one another. Ireland’s low corporate tax rate and its high tax revenues from corporate profits