Britain should learn from the policies that have driven Ireland’s recent economic boom, according to a report published this week by financial consultants, Business Strategies.
Since 1994 Ireland has experienced GDP growth of 9.2% per year, compared to 2.8% in the UK, and employment has risen by 25%. And in contrast to the UK, the growth has been led by the manufacturing sector, with substantial increases in exports.
As well as benefiting from being part of the weak eurozone,Jane Croot, managing economist at Business Strategies, said Ireland had been particularly successful at attracting foreign investment. `They were also careful, and targeted the sectors they thought would grow most strongly,’ she said.
The report says low corporate tax rates – around 10% for manufacturing – have acted as a major incentive to foreign firms looking to relocate. Employment in foreign-owned manufacturing companies in Ireland has risen by around 30% since 1975.
And while the UK regions have recently started creating manufacturing clusters, Ireland has been more successful at targeting particular industries.
`The UK regional development agencies have been identifying lots of clusters, but there’s always a danger that they will create too many and will not able to concentrate on any of them properly,’ Croot added.
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