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Multinationals’ research investment stays strong

Multinational companies supported by development agency IDA Ireland invested about €700 million in research during 2011, according to the agency’s end of year statement.

Two-thirds of the national business spend on R&D was made by the agency’s client companies, the 5 January statement said.

Foreign direct investment is central to the government’s enterprise strategy and companies working with the agency currently employ about 146,000 people, it added.

FDI investments created more than 13,000 jobs during the year, against a loss of 7,000 jobs.

The figures provided some good news against a backdrop of high unemployment, government cutbacks and tax rises. These companies also buoyed up the economy generally, accounting for €115 billion or 70 per cent of Ireland’s total exports.

The minister for jobs, enterprise and innovation, Richard Bruton, celebrated the results given the uncertainty in global markets. The country must “build aggressively” on these figures and use FDI as a way of strengthening investment in indigenous companies, he said.

“In this way we can ensure that we build on 2011’s major achievements and address the jobs crisis in a real way,” he said.

FDI now accounts for more than 14 per cent of total employment in Ireland, with technology and research-based companies major contributors.

Nine of the top 10 global pharmaceutical companies, eight of the top 10 US information and computer technology companies, 17 of the top 25 medical device companies, all top 10 internet companies and three of the top five games companies are located here, the report said.

A number of these companies announced expansion and diversification investments during the year, including Intel, HP, Boston Scientific, PayPal, VMware and Pfizer. Of the 148 FDI investments made during the year, 61 were first-time investments while 87 were made by existing client companies. Of the latter, 46 were expansions and 41 were in research and development.

The companies have highlighted availability of graduates and trained personnel and attractive corporate taxation rates as key reasons for investing in Ireland, the report said.

The continued strength of technology-based FDI encouraged the agency to emphasise the potential for employment opportunities in these sectors.

It said that almost half of all new FDI jobs created during the year were in the information and computer technology sectors. This in turn was beginning to influence the career and study choices being made by students finishing secondary school education, the report said.