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Speaker 1: Political and business leaders around the world are waiting to

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Speaker 1: see what Donald Trump as president will mean for their

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Speaker 1: economies and businesses. Ireland, as a major hub for US

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Speaker 1: tech and pharmaceutical companies, could be particularly exposed to any

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Speaker 1: changes in trade or tax policy. Joining us to discuss

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Speaker 1: is Michael Lowan, the CEO of IDA Ireland, the government

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Speaker 1: agency that oversees foreign direct investment. He's in Davas this morning. Michael,

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Speaker 1: Good morning to you. When you're looking ahead to Donald

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Speaker 1: Trump's inauguration as president, how are you perceiving the risk

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Speaker 1: to Ireland and to Ireland's economy from potential policy changes.

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Speaker 2: Good morning, Stephen, and good morning from Davos.

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Speaker 3: Yes, so, I think if you take maybe a look

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Speaker 3: back at the last twenty four months, in particular from

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Speaker 3: an FDI perspective, we've seen a very changing and different landscape.

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Speaker 3: And in the FDI world, we've seen protectionism, we've seen

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Speaker 3: industrial policies that's been responding and that is leading to

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Speaker 3: a very different landscape of which FDI has been competing.

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Speaker 3: I think we're going to see a continuation of that,

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Speaker 3: you know, post inauguration later today. But as suppose from

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Speaker 3: an Ireland perspective, you know, this is something we've been

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Speaker 3: working with for the last twenty four months and we're

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Speaker 3: going to continue to do that. We're going to focus

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Speaker 3: on the areas where Ireland brings strengths in terms of

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Speaker 3: sensibility of our economy, in terms of the talent that

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Speaker 3: we have and the innovation, because that's very hard that

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Speaker 3: multinationals their international look to international market, and we believe

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Speaker 3: Ireland is that gateway for Europe and indeed for the

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Speaker 3: world for companies, whether it's from the US or indeed

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Speaker 3: from other parts of the world.

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Speaker 4: What policies are you most worried about, though, Is it

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Speaker 4: trade tariffs or is it tax changes potentially affecting the

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Speaker 4: tax base in Ireland.

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Speaker 3: Yes, so I think both of those elements will certainly

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Speaker 3: have an impact on international trade and by extension, on Ireland. Obviously,

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Speaker 3: if we think about tariffs in the first instance, tariff

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Speaker 3: I don't think will be to the benefit of of

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Speaker 3: of anyone in the world, whether it's whether they're in

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Speaker 3: the US or or in Europe, because I think there's

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Speaker 3: timely innovation. They'll actually drive inflation and have a cost impact.

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Speaker 3: So I think they'll be counterproductive in terms of taxation Obviously,

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Speaker 3: Ireland is aligned to the global bets process in terms

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Speaker 3: of minimum taxation, and we would would be very much

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Speaker 3: as supporting that, you know, all countries around the world

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Speaker 3: stay aligned to the Bev's process because we do believe

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Speaker 3: in certainty and clarity within in the tax regime is

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Speaker 3: very important as well for companies to plan and again

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Speaker 3: to make sure that they can enable their.

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Speaker 2: Global supply chains because.

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Speaker 3: As we've learned, you know, over the last number of years,

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Speaker 3: and particularly true to the challenges we've had, whether it's

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Speaker 3: throughe COVID or the war within within Ukraine, supply chains

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Speaker 3: are are so creatily important and we should try and

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Speaker 3: protect those in every facet of our industrial policy.

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Speaker 2: From a global perspective.

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Speaker 1: Which sectors do you see as being most vulnerable to

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Speaker 1: policy changes coming from the US?

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Speaker 3: Undoubtedly if we look at the from I speak maybe

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Speaker 3: from an Ireland active you're looking at the A suppose

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Speaker 3: two major sectors that we have have interaction with the

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Speaker 3: US in healthcare and in pharm and medical device.

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Speaker 2: And indeed in technology.

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Speaker 3: I think that both of those are the sectors which

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Speaker 3: are propelling the Irish economy in essence, So I think

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Speaker 3: there are two sectors. But again, as I mentioned there,

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Speaker 3: you know, if we think about the impact of potential

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Speaker 3: tariffs or changes, and those would have an impact on

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Speaker 3: the end user customer. So I think there has to

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Speaker 3: be a balance, and I would hope and maybe we're

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Speaker 3: already starting to see this with the administration. You're seeing

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Speaker 3: that balance come into maybe some of the conversation pre

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Speaker 3: election versus the administration as it takes office, and I

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Speaker 3: think we'll see balance come to the four.

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Speaker 2: In those areas.

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Speaker 4: Yeah, but there's no downside argument, is there. Let's say,

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Speaker 4: from a US perspective, to try to re show the

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Speaker 4: pharmaceutical industry, which present elect Donald Trump has spoken about

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Speaker 4: in the past, back in twenty twenty, in terms of

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Speaker 4: the amount of pharmaceuticals and medical items that are being

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Speaker 4: made in Ireland and then exported to America is something

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Speaker 4: like more than fifty billion euros. There's no downside in

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Speaker 4: terms of you know, making that argument. You could make

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Speaker 4: it about tariffs, but not about medical pharmaceutical equipment. If

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Speaker 4: that is reshored into the US.

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Speaker 3: Well, I think what you have to consider that in

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Speaker 3: that scenario is the capability that's built up within the

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Speaker 3: supply chain, whether it's in Ireland, or let's just say

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Speaker 3: it's a US versus US. That capability is serving the

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Speaker 3: global market as well as the US markets. Obviously, there's

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Speaker 3: economies of scale, there's supply chains lin link through those

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Speaker 3: facilities and those operations, so at one level, the supply

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Speaker 3: chains are so integrated. It is the first thing you

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Speaker 3: have to consider. The second point, obviously, is in terms

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Speaker 3: of skills, because we know across the world there is

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Speaker 3: a skills shortage and as companies look to expand and grow,

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Speaker 3: they need to make sure that they can get the

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Speaker 3: skills that's necessary to do that. And again, the diversity

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Speaker 3: of global supply chains allows that diversity of skills as well.

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Speaker 3: So I think all of those factors, you know, it's

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Speaker 3: what companies look at as the look to investment. You know,

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Speaker 3: in terms of market opportunity, the skills opportunity, the ecosystem

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Speaker 3: and the disability of the economy. All of those elements

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Speaker 3: are so quickly important and I believe they will continue

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Speaker 3: to be the case as companies look to grow and

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Speaker 3: make sure that they have international markets of scale.

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Speaker 1: What is IDA Ireland's plan if US firms do move

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Speaker 1: investment away from Ireland, where Are there other countries you're

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Speaker 1: looking at attracting FDI from what's the plan?

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Speaker 3: Yeah, so I think that's a very fair question. So

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Speaker 3: maybe maybe two ways. First of all, I don't believe

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Speaker 3: that there'll be an exodus of FDI from Ireland or

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Speaker 3: US companies from Ireland because for the very point they

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Speaker 3: are bringing real value that allowed those companies to create

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Speaker 3: new markets and to grow. So I can see that

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Speaker 3: continuing as we go into the future. Yes, we will

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Speaker 3: have to compete, and we've always had to compete for investments.

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Speaker 3: But as we look at last year, we announced two

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Speaker 3: hundred and thirty four investments by IDA across our portfolio,

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Speaker 3: and that's our international portfolio, and of that investment, sixty

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Speaker 3: four sixty five percent of that investment comes from the US.

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Speaker 3: Europe accounts for somewhere between twenty eight and thirty percent,

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Speaker 3: and then the rest of the world brings in between

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Speaker 3: eight and ten percent. So we've already built diversity within

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Speaker 3: our portfolio as well.

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Speaker 2: I think what's.

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Speaker 3: Creatively important, we've changed the type of project as well.

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Speaker 2: R and D in Ireland has really got embedded.

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Speaker 3: Last year was a record year for R and D

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Speaker 3: investment within our portfolio just under two billion that was

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Speaker 3: invested in supported through IDA to our client companies. So

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Speaker 3: we built, if you want to call it, that longevity

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Speaker 3: of our FDI base, the quality and depth of what

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Speaker 3: the activities we're in our FDI base. So we're actually,

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Speaker 3: while there is a period of change ahead, we are

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Speaker 3: actually entering this from a very very strong position from

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Speaker 3: an FDI perspective, and indeed from the Irish economy's perspective

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Speaker 3: as well.

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Speaker 1: There are you know, Ireland is a long tradition of

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Speaker 1: having you know, foreign companies operating in the country, and

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Speaker 1: you've outlined that. But I do wonder how do you

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Speaker 1: make the case for attracting new investment now given the

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Speaker 1: issues particularly around housing highlighted in your own clients survey

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Speaker 1: as being a major issue for any company that wants

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Speaker 1: to set up in Ireland. How do you convince the

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Speaker 1: company to set up if there's nowhere for their workers

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Speaker 1: to live.

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Speaker 3: Yeah, so I think again that's a fair question, and

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Speaker 3: maybe as a respond in two ways. First of all,

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Speaker 3: the numbers I mentioned that we reported in December of

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Speaker 3: last year at seventy of those investments, of those two

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Speaker 3: undred and thirty four investments or first time or new

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Speaker 3: name investments in New Porland. So we continue to invest

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Speaker 3: or attract new investment into Ireland. And you're correct, yes

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Speaker 3: they're carrying capacity constraints, but we also have a response

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Speaker 3: in that carrying capacity. So we see our Housing for

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Speaker 3: All strategy which is really started to deliver on our

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Speaker 3: housing front, our infrastructure, and again these are the same

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Speaker 3: challenges that you see in every growing economy. Remember, the

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Speaker 3: Irish economy has grown significantly. Our population base has grown

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Speaker 3: ten percent over the last decade and that actually has

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Speaker 3: put strain on our investment or our infrastructure investment. But

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Speaker 3: we are responding. I think what's really helpful as well

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Speaker 3: is that this week actually the.

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Speaker 2: New Irish government has been formed on Wednesday.

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Speaker 3: In our doll and in the draft program for government,

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Speaker 3: at its very core is a number of varias, a

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Speaker 3: commitment in terms of our infrastructure and housing, our commitment

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Speaker 3: to that Ireland is going to have a revolutionary change

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Speaker 3: in terms of a sustainable energy and indeed a commitment

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Speaker 3: in terms of digital and AI. So I think therefore

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Speaker 3: the growth opportunities are and d for Ireland as part

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Speaker 3: of that global environment.

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Speaker 4: Okay, interesting in terms of the UK you're near neighbor.

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Speaker 4: Have you seen interest from companies who are leaving the

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Speaker 4: UK or interested in investing directly in Ireland as a

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Speaker 4: result of the tax changes in the UK the new

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Speaker 4: tax regime in Britain for businesses.

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Speaker 3: At this juncture, the UK continues to be a very

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Speaker 3: vibrant market for for for for Ireland and from an

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Speaker 3: FDI perspective, it's also, of course is a competitor for FDI,

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Speaker 3: and I think the UK has always been so, so

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Speaker 3: we we we see that that that interaction continuing over

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Speaker 3: this year. I think as we go forward, I do

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Speaker 3: believe there's more opportunity for for for Ireland within the

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Speaker 3: UK market and we're continuously working towards that.

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Speaker 2: So so we do see some flows.

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Speaker 3: Coming towards US, and generally not just tax related, but

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Speaker 3: very much on the basis of of skills and talent

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Speaker 3: and growth that they're the primary reasons that companies look

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Speaker 3: to invest.

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Speaker 1: In and has that Has that increased since the budget

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Speaker 1: here at the end of October, Have you seen an

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Speaker 1: increase in inquiries?

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Speaker 3: I would I wouldn't say there's a marked increase. I

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Speaker 3: think it's it's active. I think the marketplace is active,

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Speaker 3: but I wouldn't be marketing as as a market increase