Ireland’s attractiveness for foreign direct investment (FDI) remains strong with approximately eight in 10 FDI decision-makers planning to establish or expand operations in Ireland over the next 12 months, consultancy firm EY has said.
According to EY’s Attractiveness Survey, 66% of FDI investors expect Ireland’s attractiveness to increase in the next three years.
Dublin is ranked seventh in the European league table of cities attractive to overseas investors.
Skills were listed by 36% of investors as the top policy priority to improve the country’s FDI attractiveness, followed by geographical balance, noted by 32% of investors, and transport infrastructure, cited by 29%.
Some investors are considering more than one location as an attractive location for future investment.
Dublin ranked highest with 47%, followed by the south-east with 41% and the mid-east of the country with 38%.
EY said that investment intentions were particularly strong among businesses in the financial services sector, pharmaceuticals, and chemicals.
Head of FDI at EY Ireland Feargal de Freine said while 2023 was a subdued year for FDI projects across Europe and in Ireland “investor sentiment remains positive”.
“However, the global FDI landscape is changing and becoming more challenging. It is therefore important to understand investor perspectives and competitor offerings to ensure the continued relevance and attractiveness of the Irish proposition,” he said.
EY said investors consider many factors in relation to FDI, such as interest rates.
EY’s chief economist Dr Loretta O’Sullivan said the recent moves by the European Central Bank to cut interest rates “bodes well for an uplift in international investment”.
“While geopolitical and electoral uncertainty is a headwind, businesses are undertaking digital and sustainable transformation programmes and exploring AI technology.
“To attract the drivers of next-generation economic growth, Ireland should leverage its traditional strengths, hone its new capabilities and stay agile,” Dr O’Sullivan said.