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Ireland not to blame for cash hoarded overseas by US tech firms, says FDI chief
President Donald Trump 's pledge to crack down on multinational giants who store swathes of cash overseas rather than bring it home to spend in the U.S. is not being hindered by Ireland, according to the country's foreign investment chief.
Indeed, Ireland's success in attracting large global corporations, particularly in key sectors such as technology and pharmaceuticals, to launch significant operations within the country is deserved, Martin Shanahan, chief executive officer (CEO) of IDA Ireland, told CNBC on Friday.
"We've set out our stall. We have a very competitive, consistent corporate tax regime and we have been a full participant in all international efforts around tax avoidance so I don't think Ireland has any case to answer in that regard," affirmed the head of the agency responsible for the attraction and development of foreign direct investment (FDI) in Ireland.
Shanahan's confident tone comes despite the stoking of popular support during and since the U.S. election campaign for President Donald Trump's proposals to encourage American multinationals to repatriate more of the cash they hoard overseas and to create more jobs domestically.
The cash piles of the largest tech firms has generated much attention, with Apple enjoying a cash balance of well over $200 billion and Google holding around $83 billion. Apple is currently ensnared in a 13 billion euro ($13.79 billion) battle with the European Commission over money the latter says the tech giant owes to Ireland for paying too little in taxes in recent years.
Yet firms such as Apple, which has a workforce of 5,550 in Ireland, mostly based in its second city Cork and Facebook which is reportedly on track to add add a further 1,000 employees to its Dublin hub that already plays home to around 1,500 of its staff, are creating win-win situations for both countries, claims Shanahan.
"The presence of American multinationals in Ireland has been good for Ireland but has also been good for American multinationals and therefore for the U.S. U.S. multinationals need to be in Europe because they want to access the market, they want to access innovation that's there, they want to access the skills that are there and that in turn makes them stronger and it makes them stronger in the U.S. as well as around the globe," contended Shanahan.
"I do not envisage a situation where U.S. multinationals are not internationalizing and I think if they're going to internationalize in Europe, Ireland is the place where they're going to do that," posited the IDA Ireland chief.
Ireland boasts one of the world's highest ratios of FDI to gross domestic product (GDP) and the country's achievements in luring overseas firms to its shores will undoubtedly be high on the agenda during Irish prime minister Enda Kenny's widely anticipated visit to President Trump in mid-March.
As the emerald isle gears up for Brexit and the challenges that will pose, above all, to its domestic economy, namely in critical sectors such as agribusiness which rely enormously on the U.K. as a borderless export destination, the ability of Kenny's team to convincingly sell Ireland's story abroad as an attractive trade partner will be under close scrutiny.
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