Nestled on the west coast of Ireland, Shannon functions as a fulcrum between the cities of Galway and Limerick. What they lack in international presence, these three locations more than make up for with inward FDI attraction.
Traditionally an agricultural region, this stretch of the 'Atlantic Economic Corridor' has made improvements in recent years when it comes to skilled job creation, infrastructure development and the attraction of a truly diverse set of multinational companies.
Three become one
A key pillar of any region’s FDI success is arguably the professionals responsible for encouraging inward growth. In Ireland’s mid-west this is no different. From local council and chamber officials to private entrepreneurs and community champions, all espouse a philosophy of regional co-operation. Against the ever-present lure of larger urban centres elsewhere in Ireland, the region's ability to compete as a single entity has been essential.
This unified approach is something that all three locations are striving toward. When orthopaedic products specialist Zimmer Biomet decided to invest €51m expanding in County Galway, rather than at its Shannon site where it has been manufacturing since 2007, the move was seen as neither a win for Galway nor a loss for Shannon, but was considered a win for the corridor. “Our experience in the mid-west has been extremely positive,” says Zimmer general manager John Lynch. “We were able to leverage this by establishing a second facility in Oranmore, just 45 minutes from Shannon.”
This idea of a truly integrated regional development strategy is shared by Kevin Thompstone, local investment expert and former CEO of regional development body Shannon Development. “We have expanded our mindset,” he says. “If we have to compete with large urban centres, we have to create one.”
The establishment of a regional economic corridor has arguably been a driving factor in Limerick and Galway obtaining first and second position, respectively, in fDi Magazine’s European Cities of the Future 2016/17 rankings at a micro city level. In the same rankings, Galway, Limerick and Shannon took the top three respective spots in the Economic Potential category among all micro cities.
Both corporations and government laud the region’s career benefits and its high quality of life. “Ireland is a small country; you’re not really very far away from anything. For raising children it’s fantastic,” says Julie Dickerson, managing director of aircraft engine builder SES, which has operations in Shannon.
Catherine Duffy, senior vice-president at financial services provider Northern Trust in Limerick, adds: “Quality of life is excellent. You can live outside or inside the city with great eateries and sporting facilities.”
A taxing issue?
Alongside a healthy work-life balance, Ireland’s appeal has long been ascribed to its low corporation tax. However, being the sole native English-speaking country fully within the framework of the EU and eurozone, and boasting a young and highly educated population, Ireland is increasingly attracting service-based investments.
Uber has recently established its centre of excellence in Limerick, hoping to eventually employ up to 300 staff. Though the company has no plans to establish a revenue-generating arm in Ireland, Limerick’s favourable real estate costs and the business case presented by local authorities were deciding factors in Uber's decision, rather than lower taxation.
“This building is a huge opportunity – to be able to be in the centre of Limerick was key for us,” says Kieran Harte, general manager of Uber Ireland & Northern Ireland, about the company's new location. “The last thing we wanted was to be in a business park on the outskirts of the city.”
Mr Harte also praises Limerick’s overall openness, as shown by the city's second placed finish in the Business Friendliness category of fDi Magazine's European Cities of the Future 2016/17 Awards. “We have had a fantastic experience of launching,” he says. “We’ve had huge offers of support and we have felt extremely warmly welcomed both by local businesses and the council. We haven’t had the starting challenges that we have had elsewhere.”
That said, challenges clearly exist among the Atlantic Economic Corridor cities, most notably the lack of adequate high-quality office space and staff with specialised skillsets. “The current challenge is expanding the French-speaking team. It’s a mixture of our need to grow quickly and the lack of available fluent French speakers in Limerick,” says Mr Harte. James Ring, chief executive of the Limerick Chamber of Commerce, adds: “Space is an issue. We need more office space in the city centre and we need to see investment from the private sector to achieve this.”
While developing an environment conducive to the growth of specialised skillsets is more complex, the region has been proactive in tackling issues of space. The ambitious Limerick 2030 development initiative is one such project – a €1bn strategy to redevelop 81,000 square metres of city centre space into three new economic campuses and 546,000 square metres of advanced office space. The plan should create the environment new-age multinationals are increasingly seeking.
On a smaller scale, Galway’s Portershed hub, supported by industry giants such as KPMG and IBM, aims to spearhead the city’s drive to create a thriving start-up community in the city centre. Cluster attraction is a strong motivating factor for many new investments and the hub is expected to bring jobs and investment into the very heart of Galway.
Beyond the big two
An additional threat to the west’s success is the pre-eminence of Dublin and Cork as magnets for inward investment, but progress has been made in developing the west’s ‘brand’.
Troy Studios is establishing what will be Ireland’s largest film studio in Limerick, a clear endorsement of the opportunities available in the region over Ireland’s existing film hub in the Wicklow Mountains in the east of the country. Westpark in Shannon opened in 2005 and now provides modern office space for more than 50 companies employing upwards of 2000 people. With plans to add five office blocks comprising 160,000 square metres, Westpark is keen to capitalise upon the area’s lower costs and assist in the wider development of the corridor. “The expectation of salaries along with high production and low attrition can provide very generous savings of up to 30% in the region,” says the park’s managing director, Brian O’Connell.
This corner of the Atlantic coast has much to do if it is to continue its march towards greater FDI attraction and its associated economic development. Inherent natural beauty, favourable costing and the opportunity for attractive work-life balance have so far been successfully augmented by the regional authorities’ passion for FDI. Time will tell whether this can be truly sustainable in an increasingly connected and urbanised world.