Tánaiste's speech at EU-CELAC business summit, Santiago, Chile26 January 2013
Excellencies, ladies and gentlemen
I’d like to begin today by thanking the Chilean Government and the Chilean Confederation of Production and Commerce for this opportunity to address the EU-CELAC Business Summit.
I am here today in two capacities. I am the Tánaiste – or Deputy Prime Minister, as we call it in my native language – of Ireland. And I am the Irish Minister for Foreign Affairs & Trade. But I’m also here representing the Irish Presidency of the Council of the European Union, which we hold until June.
This weekend, our focus is on the relationship between the EU and the countries of Latin America and the Caribbean – a very deep, longstanding and important relationship.
Many of you here today are among the key figures driving the significant – and mutually-beneficial – trading relationship that we enjoy. It is worth remembering that the European Union is this region’s second most important trading partner, after the US. In fact, trade in goods between our two regions has more than doubled over the past decade.
The EU is also CELAC’s biggest provider of Foreign Direct Investment – which stood at 43 percent in 2010, and has grown since, no doubt.
For my own country, Ireland, our links with Chile and the wider Latin America and Caribbean are also strong – and growing. Our bi-lateral trade in 2011 was worth just shy of €2 billion, and the most recently-available figures point to a more than 30 percent increase in that trade during 2012 bringint it to 2.5 billion. That is a hugely positive trend that I hope to see continue.
Few countries understand quite so well as Ireland just how interconnected and inter-dependent the global economy has become, and, of course, that the European Union is not only important to its 27 member states, but to the entire world.
The EU is now the single largest consumer market in the world, boasting 550 million consumers – and counting. On the flip side, it is anticipated that, by 2015, 90 percent of all economic growth will take place outside of the EU’s borders – much of it in this region.
So it is abundantly clear to all of us that what happens in Europe matters here, and what happens here matters in Europe.
Over the past five years, the crushing burden of the economic crisis has been felt by us all. Europe has suffered. But here in this region you have also felt the pressure of the uncertainty that surrounded Europe’s single currency, the Euro, and the severe economic collapse that hit many countries, including my own.
But, today, I can tell you that Ireland is turning the corner. We are becoming a good news story.
After many difficult years, 2012 was the year when we started to see renewed optimism in Ireland that we are weathering the economic storm. It brought a sense that the tough but necessary decisions that my Government has made – on many fronts – are having the desired impact and that there is, in fact, light at the end of the tunnel.
The Irish taxpayer was left to bailout several banks that behaved recklessly for many years fuelled by a massive property bubble – increasing our national debt to 120 percent of GDP, and leading us to enter into an EU/IMF bailout programme.
As a result, over the past few years we have had to make the biggest fiscal adjustment our nation has ever undertaken in order to bring our public finances under control.
A quarter of a million private sector jobs were lost during the crisis as Ireland’s real GDP contracted by close to 15 percent – compare that with the 4 percent drop experienced by the US during their most recent recession, or the 33 percent drop experienced during the Great Depression of the 1930s.
This truly was a Great Recession for Ireland.
But the worst is now behind us. The difficult decisions we made, and the patience and hard work of the Irish people in bringing about this recovery, are beginning to pay off.
The Irish economy has returned to growth, which is expected to continue into 2013.
That growth is being driven by our exporting sector. Irish exports have now exceeded their pre-crisis levels – increasing by 5.1 percent in 2011 and by 3.8 percent in the first half of last year.
Exports in the agri-food sector have soared 25 percent in the past two years.
In many ways, we are trading our way to recovery.
A key factor underpinning these numbers is the enhancement of our competitiveness, which has improved by 22 percent compared to the eurozone average.
The past year also saw Ireland make considerable progress in our phased return to the bond markets. Last year we sold €7 billion of sovereign debt. And earlier this month we sold €2.5 billion in one bond sale – roughly 25 percent of our borrowing target for 2013.
We intend to step up this re-engagement with the market in the coming months so that Ireland is positioned to successfully exit our EU/IMF programme later this year – making us the first programme country in the eurozone to do so.
On the jobs front, we have also seen signs of renewal. 2012 saw the highest net job creation from Foreign Direct Investment in Ireland in a decade, with 6,570 net new jobs created by client companies of the Irish state agency that works to attract new companies to Ireland.
Among those who invested in Ireland last year were several globally-recognised names including Apple, PayPal, EA Games, SAP, Cisco and Eli Lilly.
Our economic recovery is also steadfastly underpinned by our young, highly-educated, ambitious workforce. The flip side of our unemployment problem is that we are first in the world for availability of skilled labour. We also have the youngest population in Europe.
We are known for our strong pro-business climate, our fair and transparent corporate tax regime and a technological infrastructure-and-know-how that is demanded by companies – both indigenous and international.
We are the top country in the world for investment incentives, and among the top ten easiest countries in the world in which to start a business.
Indeed, 93 percent of international companies say their Irish investment is a success. We are also ranked first in the world for the flexibility and adaptability of our people, and are among the top-ten global innovation performers.
We have managed to maintain our diversified economy through the crisis – something I know many of you here are working hard to do also – attracting companies at the cutting edge of their sectors in the mobile, cloud, biotech, pharma, nanotech and renewable energies spaces.
Ireland is a world leader in many of these areas and is now home to eight out of the top 10 global ICT firms, nine out of the top 10 global pharmaceutical firms and all of the top 10 “born-on-the-internet companies”.
In short, the Irish economic story is that we restored financial stability, regained our competitiveness, made some tough choices and are now seeing growth return – as well as jobs.
It hasn’t been easy but I am confident that, if we stay the course, and if we achieve an appropriate deal with the European Central Bank to make our national debt more sustainable, that by the end of this year we will be talking about post-crisis Ireland.
And that is our theme for our current Presidency of the EU – Stability, Jobs and Growth.
There are of course many similarities between the Irish story and that of the EU. Youth unemployment is the greatest problem affecting all 27 member states and the Irish Presidency is focussed on pursuing measures that will tackle that.
We are introducing a package of legislation that will help deepen the Single Market – perhaps the greatest success story of the European project. We see huge growth potential in the digital single market too, and our package of measures will go a long way to spurring increased commercial activity online.
We are supporting SME’s, who collectively employ close to 80 million people across the Union.
And we are aggressively pursuing free trade agreements with strategic partners around the world.
No doubt, all of this sounds very familiar to you here. This region has excelled at tapping into global trade. And it is my great hope that we can work together to further strengthen the many links between our regions.
As one example, Ireland has just approved a significant investment in support of an Irish-Brazillian research partnership. We have allocated just over half a million euro which will be used to advance collaborations between Irish and Brazillian scientists.
Up to 4,000 Brazilian under-graduate and post-graduate students will now come to study in Ireland over the next four years, which will lead to greater opportunities for collaboration between Irish and Brazilian education and research institutions.
This programme will deliver excellent research that will have a positive impact on the economic future of both Ireland and Brazil... and it is my hope that we will be able to increase the number of partner countries involved in this programme as we broaden its parameters.
So, as cooperation between our two regions moves forward, let us seize fully as many opportunities as we can to support the just and sustainable development of our regions.