Business Opinion:As wake up calls go, they don't come much louder. Last week the US multinationals who have played such a key role in this country's economic renaissance put their cards on the table.
The message was pretty simple. There has been more than enough chat and posturing about taking the Irish economy to the next level. Now is the time for action and if action is not forthcoming, then US mobile capital is out of here, with all the consequences that entails.
If you think this is a bit over the top, then I suggest you get hold of a copy of the document published last week by the American Chamber of Commerce Ireland called Retuning the Growth Engine, and have a read. It amounts to an ultimatum to Ireland to get its act together or the symbiotic relationship between this country and US multinational corporations will go the way of the dodo.
From the get go the report does not pull its punches. The first paragraph of the introduction gives a nod to various government initiatives before stating "now is a time of implementation". It then lays it on the line; stating "[ US companies] will continue to invest as long as the economic rationale is clear . . . US companies want Ireland to perform to the best of its ability to sustain current levels of economic activity and present new 'return on investment' opportunities."
The report concludes with the following warning: "Discussion and debate on strategy must quickly give way to collective action by all the stakeholders. The creation of a new dynamic knowledge economy requires not only vision but determined leadership from within, to take bold steps, make hard choices and invest for the future. The American Chamber and its members will do our part."
So what exactly is it that US companies want done as the price for their continued favour? Well it's five things actually.
The first is getting the education system sorted out. The want Ireland's education system pushed into the top 10 per cent of developed nations. They have even gone so far as to set targets for the numbers going on to third level and the amount of money they want the Government to spend to achieve this.
Next they want a research infrastructure put in place for all these graduates to work in. And they want it to collaborate very closely with the US multinational community. Part of this is a new network of science and technology parks.
After that they want "an innovative fiscal, legal and commercial framework" that facilitates and encourages the commercialisation of the fruits of all this research.
The fourth is for the entire edifice - once it has been constructed - to be steered in the direction of the various areas of technology that the existing multinational base currently occupies, such as IT and medical devices. The final element is the maintenance and enhancement of the tax and incentive regime.
As one would expect, the chamber has a snappy name for all this. They call it "Innovate Ireland" and sum it up as "a dynamic partnership between multinational companies, indigenous SMEs, academia, the Government and the people of Ireland".
Some, however, might baulk at the idea of turning the State's education system and much of its infrastructure into some sort of outsourced research and development function of a handful of US corporations. Others might argue that the time for such sensibilities is long gone and that we made our Faustian pact with US style capitalism many years ago.
A more significant issue is the notion that if the Government goes along with what the American chamber wants, then national policy making has been handed over to the boardrooms of these same US corporation.
It's a serious point and will have to be faced up to by whoever is in power come the autumn. There may be some debate, but fundamentally one fears they will have little choice other than to pay attention to what the American chamber is saying and then get a move on.
The reason is obvious, but just in case it might have escaped the notice of anyone in Government, the American chamber helpfully spells it out on the bottom of the last page of their document, which contains the following two paragraphs. "US companies have a $61.5 billion (about €50 billion) investment in Irish-based operations (7.6 per cent of all US investment in the EU and 3.5 per cent world wide). Today an estimated 100,000 people are directly employed in over 580 US firms in Ireland while indirect employment in the sub-supply industry and services has been estimated at over 225,000.
"US firms contribute over €2.4 billion to the Irish Exchequer in corporate taxation and a further €13 billion in expenditure in the Irish economy in terms of payrolls, goods and services employed in their operations. The US is Ireland's top export destination and US firms based in Ireland export an estimated €57 billion of products and services from Ireland into world markets."
Enough said.
