DUBLIN: With alarm bells ringing regarding the difficulties posed by Brexit for Ireland and geopolitical developments stirring up uncertainties around trade and investment, there is a serious need to consider policies within our control that can help grow Irish exports. There is much that we can’t control but are working to influence. However, there is much of our destiny that lies in our own hands. The announcement by the Government that it will commission a study to look at economic opportunities for Ireland from EU Free Trade Agreements (FTA) is most welcome. It emphasises that we have a small domestic market and that, in light of challenges from Brexit, diversification into new markets and growing Irish exports in existing markets is more critical than ever. The IMD World Competitiveness Centre ranks Ireland’s “export concentration by partner and product” as 52nd and 47th in the world, emphasising the need for such action.
Ireland has “superstar” companies which have achieved great global success. However, figures show the Irish indigenous sector generally is focused on a narrow range of export destinations. Some 27 per cent of Irish firms export to just one market. In 2015, the median number of export markets for Irish exporting firms was just three. The opportunities on offer from new EU FTAs with markets such as Canada and Japan herald much hope, not to mention our access to the EU market itself. The prospects are good if we can take full advantage. However, an abundance of talent, innovation and capital investment will be central to the plan. Detailed analysis in a new Irish Tax Institute report, A Future Tax Strategy to Grow Irish Indigenous Exports, highlights a range of mismatches in tax policies that are hindering efforts to grasp global trade opportunities and meet the challenges Ireland faces. While our 12.5 per cent corporation tax rate is valued by many Irish businesses, we have a pattern of sustained high rates across a range of other taxes that are critical for growth and we have tax reliefs that are either not available or not accessible to Irish SMEs.