Hewlett Packard was given the choice, and raft of incentives, and opted for Ireland. Chungwa, a picture-tube manufacturer, weighed up similar entreaties and went to Scotland. Digital, proving that a multinational knows no loyalty, moved from Ireland to Scotland.
In all three instances, the multi-national benefited while the two countries at the vanguard of attracting Foreign Direct Investment (FDI) slogged it out with one another. The rivalry between the Industrial Development Agency and the Scottish Development Agency in the 1980's and early 90's has now calmed a little as the new agencies, Locate in Scotland and Enterprise Ireland, focus on new markets. The fact remains, though, that Scotland and Ireland offer very similar qualities. Both are on the edge of Europe, both suffer from poor transport links to markets and both lack a sizeable indigenous industry.
In their favour, they boast well-educated young workforces and aggressive enterprise agencies. The crucial difference is that Ireland has a corporation tax rate one third of Scotland's, and Dublin oversees the fastest growing economy in Europe.
To date the two countries have had equal success. Locate in Scotland has attracted 600 facilities employing 100,000 people. The Industrial Development Agency has lured over a thousand companies and 116,000 jobs. Locate in Scotland regard the Irish as their main rivals.
Corporation tax of 10 per cent compares very favourably with a British rate of 30 per cent. Even when Ireland's rate rises to 12.5 per cent, it will still knock spots off what the Scots can offer. The new Scottish parliament has no powers over corporation tax. Coupled to this both countries must now deal with the effect of the single currency. Ireland's entry into the Euro means it offers lower transaction costs within the community. Scotland's use of Sterling means it offers more security at times of doubt in the new currency.
Enterprise Ireland and Locate in Scotland have both worked at improving channels of communication. On a recent trip to Scotland An Tanaiste Mary Harney signalled that Dublin and Edinburgh could co-operate on future FDI bids, linking the skills of the two countries.
"We are less head to head now" said a source in Locate in Scotland, who said the Scots had become more "philosophical" in their approach. "If money was the only reason people went anywhere, then Ireland would be full and we'd be sitting in a field of potatoes," said the source.
Locate in Scotland emphasise the better internal transport system of Scotland, alongside its strong academic sector. Quality of life, and in particular proximity to good schools and golf courses also plays a part.
A recent success for Scotland was attracting Cadence, a Californian microchip designer. This is the kind of high-value job now preferred over the old "screwdriver" assembly plants. However Cadences' promise of creating 1,900 jobs has recently be cut in half, highlighting the unpredictable nature of FDI employment.
Not only this but Scots pay highly for their FDI plants. In 1996/97 Scotland paid out more Regional Selective Assistance cash to foreign firms than any other British region. Between 1987 and 1997, Scottish RSA payments translate into an average-cost-per job of £8,300, the highest sum in Britain except for the Northeast of England.
This has lead to a political cry for more investment in indigenous industry. For this Scots look enviously across the water to Ireland, where indigenous firms are assisted by rapid economic growth. It remains the enigma of the Scottish economy, that after 50 years of FDI and a concentration of electronic firms, it has failed to ignite its own electronics sector of any size.
Scotland's victory in winning Digital in 1993 was immediately followed by accusations against Irish politicians. Since then the Irish economy has raced ahead, leaving Locate in Scotland and Scottish politicians to ponder on the question on what they must do to stay competitive.
