Peter Keegan, President
Appointment Date: 14.01.2013
Company: American Chamber of Commerce Ireland
Business Type: Chamber of commerce
Peter Keegan, country executive at Bank of America Merrill Lynch, has been appointed president of the American Chamber of Commerce Ireland, the representative body of 700 US multinationals employing 115,000 people in Ireland.
Speaking on his appointment, Keegan said that the role FDI is playing in steering Ireland through the current economic crisis had put an international spotlight on the importance of such investment to growing economies.
“Today, Ireland’s economic model is helping to put us in a far stronger place than we were at 12 months ago. What is distinguishing Ireland is our adherence to the recovery plan and the strength and ongoing success of its foreign direct investment efforts. These have played a significant role in our economic success to date and are playing an even more crucial role in our current economic recovery.
“The positive impact of FDI should be consistently recognised and supported. In addition to the jobs created by multinational companies here, American companies make a large contribution in corporate, payroll and other taxes and have been leading Ireland’s export success, as well their impact to the overall reputation of the country. Competitiveness is a crucial factor in this, and we have to become ever more vigilant in protecting our attractiveness as an investment location,” he said.
“When it comes to competing for investment we are seeing more and more countries strengthen their offering and attempting to replicate Ireland’s success. The United Kingdom, for example, has announced a further reduction in its corporation tax rate and is set to introduce a number of further incentives to attract foreign investment,” Keegan continued. “All of this reinforces the need for Ireland to continuously review and update the offering to foreign direct investors to retain the attractive environment and protect the 115,000 jobs that we have today as a result of hard-won competition for US foreign direct investment.”
Keegan said that the Taoiseach’s ambition to make Ireland the best small country in the world to do business must be kept at the centre of all Government policy, “whether that relates to fiscal, regulatory, education, health, innovation or infrastructure policies”.
Keegan defended Ireland’s competitive tax regime, which is internationally recognised, and said that the American Chamber believed a competitive tax regime is a legitimate competitive tool and that it remains core to Ireland’s economic policy. He pointed out that in 2012, €4.2bn was collected by the Irish Government in corporation tax with foreign companies the largest contributors.
He urged the Government to use its presidency of the EU to create greater understanding of the benefits to the broader Union of Ireland’s success in attracting FDI. He also said that certainty about Ireland’s tax regime was critical to investors when looking at Ireland as an investment location.
Keegan praised the work of IDA Ireland in helping US multinationals to locate here. “IDA recorded its third successive year of jobs growth in one of the most difficult global economic recessions ever. In total, there were 145 individual investments, with 66 (over 40pc) from companies coming to Ireland for the first time. Last year, IDA client companies spent €18.8bn in the Irish economy.
“Tax, talent and competitiveness are the three key factors in attracting investment to Ireland,” according to Keegan. “Talent in my view is ultimately the single most important factor to sustain and grow our economy. Consistent investment in education by successive Governments has ensured a plentiful supply of highly qualified employees with a deserved reputation for flexibility and innovation. In a recent interview, the vice-president of Dropbox said their primary decision criteria when looking at where to expand in Europe was, ‘Where is the talent?’ This is a question raised by every company faced with a new investment decision. As a country we need to ask, ‘Do we have a talent strategy to match our industrial growth ambition?’ The work of the Expert Group on Future Skills Needs is welcome but it will only yield results if our educators and Government action their reports.
”There are skills shortages in some sectors that, in the shor- term, cannot be filled within Ireland. We, therefore, need to ensure that Ireland remains attractive for skilled workers to relocate to. In addition, we support the review by Minister Bruton of the Employment Permit Scheme, and we hope that it will result in a solution to make it possible and easier for companies to recruit candidates from abroad if the skills required are unavailable in Ireland”.
Keegan said that Ireland was renowned for its flexible workforce and their ability to adapt quickly to changing business needs. “This willingness and ability to change has been a clear competitive advantage for Irish affiliates and has greatly enhanced our reputation as a good investment location. Great care must be taken to ensure that any reform of industrial relations regulations does not damage or limit this responsiveness and flexibility. The model of direct engagement favoured by multinational companies has delivered excellent benefits for employees and the rights of employers to directly negotiate with their employees must be protected in any legislative changes introduced.”
The 2012 IMD Competitiveness Report saw Ireland climb four places from 24th to 20th in the list of global competitive economies. While there has been improvement in Ireland’s position, Keegan cautioned that this has been felt primarily by new businesses and that a legacy of high costs remains for established industries. He added that there could be no complacency in terms of continuing to seek improvements in the broader cost base. “The cost of energy in Ireland, for example, is a significant cost on business due in no small part to the high levels of duty and tax payable. With energy costs lower in the United States and costs continuing to fall, the disparity in energy prices has the potential to damage our competitiveness. The decision not to increase excise duties on petrol and diesel in the recent budget was very welcome and its importance cannot be underestimated,” he said.
“There are signs that stability is slowly returning to the Irish economy. Decisive Government action has shown determination to restore order to the public finances and has resulted in increased confidence in Ireland on the bond markets and from the international investment community.”
Keegan added that the ‘competitiveness’ improvements seen in Ireland’s indigenous manufacturing and services sector and in the multinational community must be replicated across the public sector. He expressed confidence that with the right decisions and actions, Ireland’s future as a location for US investment would remain secure and that the 700 US multinational companies located in Ireland will continue to be a major net contributor to Ireland’s economic and social development.