Govenrment and Business Environment Case Study

Ireland: Destination for FDI

OR

Abstract:
In the late 1990s, Ireland emerged as one of the most favored manufacturing destinations for knowledge-based companies from Europe and US. Software and hardware companies like Microsoft, Intel, IBM, and Apple as well as pharmaceutical giants such as Pfizer, Bristol-Myers Squibb and GlaxoSmithKline, had multiple manufacturing facilities in Ireland. Also, Financial Services and Medical Technology companies had set up operations there. By 2003, many knowledge-based foreign companies, allured by the Irish government’s initiatives and its favorable business environment, invested billions to establish multiple operations in Ireland. The rivalry between the companies resulted in intense competition for hiring and retaining, otherwise scares, quality employees. Also, due to the slump in the country’s economy, rising inflation and insufficient infrastructure, Ireland was beginning to lose its competitive advantage in attracting FDI. At the same time, many countries in Asia (mainly China and India) and Eastern Europe started emerging as potential, low-cost manufacturing destinations, which were expected to absorb all future investments by the MNCs. So, Ireland has to shift gear toward higher, value-added production.

Pedagogical Objectives:

• To understand Ireland’s competitive advantages as outsourcing destination
• To analyse business and economic environment of Ireland in general and labor as well as capital market in particular
• To analyse the possibilities of Ireland in making Clusters of knowledge based companies
• To discuss the future of Ireland as FDI destination compared to China , India and CEE countries.

Keywords : Government and Business Environment Case Study,Ireland, FDI (foreign direct investment), Knowledge economy, Single market, European Union (EU), Information and communications technology, National development plan, Intellectual property rights, World economic forum, Growth competitiveness index, Business competitiveness index, OECD (Organisation for Economic Co-operation and Development)