On Tuesday, the Government approved the proposal by Charlie Flanagan, the Minister for Foreign Affairs and Trade, to start work on the two cross-sectoral regional strategies, namely Asia-Pacific and the Americas. Both of these will fit into the broader trade policy, Trading Better, on which work has also started.
Last week, Minister Flanagan convened at Iveagh House a meeting of the Export Trade Council (which includes the Ministers and State Agencies involved in trade and members of the private sector). The Minister was keen that the Council focus on Asia for a number of reasons.
The Council’s discussions would usefully feed into the cross-sectoral strategy for the Asia Pacific region. He himself had travelled to a number of countries in Asia and is very aware that we have been making progress there in trade terms. Brexit has highlighted the exposure of Irish business to the Sterling market and the need for market diversification. And, as can be seen in facts and figures in the press statement attached below, Asia continues to be a global economic powerhouse.
The Minister invited our Ambassadors from Tokyo (Anne Barrington), Beijing (Paul Kavanagh) and Bangkok (Brendan Rodgers) to offer a scene setter for the discussions. Brendan could not make it because of the death of the Thai king so Maeve Collins, Asia Pacific Director General, ably filled in to brief on ASEAN, the Association of South East Asian Nations.
There is no doubt that the potential for Ireland to increase its trade with Asia is enormous. However the discussion at the Council was framed in realistic terms about what it takes to convert that potential into real gains.
Our footprint there in diplomatic and state agency presence is comparatively light, though it has vastly improved in recent years. Asia is not a monolith but highly variated by region, nation and business culture. Relationships at all levels need to be built because government and business are closely related. High level visits by Ministers are critical to confirming the relationship and opening doors. (For example, the uptick in interest in Ireland by Japanese companies follows several high level visits and that is no coincidence, as Anne pointed out.) Irish companies need to scale to meet the demands of sustaining an export drive there and in meeting market demands. Given the complexity of local business culture, Team Ireland needs to operate there cohesively. Ireland’s visibility in the region is low and we have to take very concerted efforts to raise that and to brand Ireland effectively.
We are taking Asia seriously. The Minister for Food, Forestry and Horticulture, Andrew Doyle, joined the discussion with insights from his recent trip to Vietnam and Korea. Minister for State for Financial Services, Eoghan Murphy, also contributed fresh from promoting IFS 2020 in Hong Kong, Singapore, Shanghai and Tokyo. The Minister for Jobs, Enterprise and Innovation, Mary Mitchell O’Connor was not at the Council this time because she was heading to the US (and plans to be in Asia before the end of the year). Richard Bruton, Minister for Education and Skills, was on his way to China to accept Ireland’s award as a ‘Country of Honour’ in Beijing at the China Education Expo (more details here).
With contributions from the Departments, IDA, Enterprise Ireland, Bord Bía, Tourism Ireland and Science Foundation Ireland, the ETC’s discussions last week were rich and insightful and they will feed into the formulation of the cross-sectoral Asia Pacific regional strategy. Maeve is ably leading this process, supported by a working committee and with input from stakeholders.
Brexit of course featured in the discussion on Asia with a key point being that Ireland offers certainty for business where the UK now presents uncertainty. Japan had been blunt to the UK on this point, as Anne noted, and Paul confirmed the opportunities for Ireland in China as a result, so long as we convey the message that Ireland’s future is with the EU.
At the end of the Council, the Minister Flanagan launched the New Collaborative Research Funding Partnership between Science Foundation Ireland and the National Natural Science Foundation of China. As the Minister said in his remarks: “I am delighted to announce this major partnership between Science Foundation Ireland and the NSFC, particularly on the day of an Asia-Pacific focused Export Trade Council meeting. I have no doubt that the links Ireland is forging with partners in China in the areas of science and technology will be of tremendous benefit as we strive to diversify the breadth and reach of Irish trade in years to come, and will support jobs in both countries.” More information on this high significant Ireland China partnership is here.
After such a productive exchange we were pressed for time but Minister Flanagan took the opportunity to brief on Brexit related developments closer to home, including his meetings in the UK and Europe and preparations across government, notably on identifying our core interests. Finally, addressing an issue raised by the private sector at a previous Council, Minister Murphy briefed on his work to address the issue of insurance costs which adversely affect Irish competitiveness.
Eamonn
DG Trade, DFAT
27 October 2016
Press Release
Minister Flanagan secures Government approval to commence work on new cross-sectoral strategies for Asia-Pacific and The Americas
This morning (Tuesday), the Government approved a proposal by the Minister for Foreign Affairs and Trade, Charlie Flanagan TD, to commence work on two new whole-of-government cross-sectoral strategies for Asia-Pacific and The Americas within the remit of the Cabinet Committee on Economy, Trade and Jobs.
Minister Flanagan stated:
“The timing for these new strategies, promised in the Programme for Government, is appropriate as, in the aftermath of the UK referendum vote, we move to consolidate our bilateral and trade relationships with established partners and find new trade opportunities with growing markets.”
On opportunities in Asia-Pacific, Minister Flanagan stated:
“I am very excited by the potential for Ireland to develop real, lasting and strong economic and social links with these growing regions. There was a keen interest in Ireland at the ASEM Summit which I attended in July. Total exports of goods and services from Ireland to the Asia Pacific region exceeded €20 billion in 2014 and continues to grow. As a trading nation it is vital that Ireland seeks opportunities to meet growing demand for imported goods and services in the region. In the past 20 years, China and India have almost tripled their share of the global economy and increased their absolute economic size almost six times over and become substantial contributors to global economic growth.
“Nine of the 10 fastest growing mega-cities in the world are in Asia. In years when economic growth in the western world was muted, many countries in Asia achieved consistent average annual GDP growth rates in the range of 5% to 8% per annum. The Asia Pacific region is home to more than half of the world’s population, millions of whom have been lifted out of poverty in the last decade and a growing percentage of whom are middle class. The region is also home to some of the youngest populations in the world. India alone is home to one sixth of the world’s population with some 1.3 billion people, more than 50% of whom are under 25. As Europe ages, we must look East to secure our own future.
“What happens in the Asia Pacific also directly affects the wider world, and it matters in particular to a small, open economy such as Ireland. Particularly now, in light of the UK referendum, the Government is determined to do everything possible to develop and capitalise on Trade, Investment and other potential links with the region. The rise of China has continued and China is now a key driver of global economic growth as well as an ever more engaged global player, with a population of 1.35 billion people and a GDP of over €10 trillion. Total trade between Ireland and China was worth approximately €8 billion in 2014 and it is a key market for Irish agri-food exports.
“Japan is a mature developed economy and is still the world’s third largest, and continues to be one of our key trading partners and the largest source of FDI into Ireland from Asia. Trade with Ireland was worth over €7 billion in 2014. Japan as well as having great potential for Irish exporters, is an important springboard to other Asian markets. South Korea was the first country in the Asia Pacific region to have a fully operational Free Trade Agreement with the EU. Since the coming into effect of the FTA, EU exports to Korea have increased by 55%. In the same period, Irish exports to Korea have almost doubled.
The ASEAN Economic Community – established in late 2015 – aims to develop greater economic integration among ten countries in South East Asia, and presents significant potential over time for enhanced trade opportunities in a region which has a combined market of US$2.6 trillion and over 620 million people. In 2014 Ireland’s total trade with the ASEAN region was €4.6 billion.
The Asia Pacific region also includes Australia and New Zealand, countries with which we have long standing and strong historical ties, as well as growing people-to-people, education and business connections.”
On opportunities in The Americas, Minister Flanagan stated:
“The Americas region provides Ireland with some of our largest export markets and sources of inward investment. Hundreds of thousands of visitors from the region come to Ireland each year to holiday or study. The region – especially Canada – became home to thousands of young Irish people during the recent economic crisis, helping to refresh Irish communities and trans-Atlantic links. Canada is also a key partner in terms of FDI, exports, education exchange and tourist numbers visiting Ireland. The US will remain one of the primary sources of FDI into Ireland, as well as a vital export market. The US alone is also the second largest tourist market in terms of visitors to the island of Ireland. The US is the largest single country of origin for international students in Irish higher education institutions. Students from the US comprise 19% of full-time international students studying in Ireland.
“St. Patrick’s Day provides a unique opportunity for Ireland to showcase what we have to offer to both Canada and the United States.”
“Latin America and the Caribbean also present enormous opportunities for Ireland, with a combined population of 643 million people, GDP of $US5.1tn and a burgeoning middle class. It’s a key target as part of our trade diversification agenda, and with EU trade agreements already in place with Central America, the Caribbean, Colombia, Peru, Mexico and Chile, there is a solid framework in place for Irish exporters to do business with the region.
“In 2015, total goods trade with the Latin American and Caribbean region was worth €3.59 billion, up 11% on 2014, with two thirds of this being Irish exports. Weextended our footprint in this part of the world in 2015 with the opening of a trade-focused Consulate General in Sao Paulo, adding to Embassies in Buenos Aires, Brasília and Mexico, as well as IDA and Enterprise Ireland offices in Brazil. The Latin American region was also identified as a priority for the new commercial attaché scheme, and recruitment processes for new commercial attachés are underway in Brazil, Argentina and Mexico.
“The strategies are not only about trade, but will also look at deepening political and people-to-people relationships. Already, Ireland works closely with like-minded countries in Latin America and in the Asia Pacific region in the multilateral arena. Many countries in these regions, like Ireland, have a proud tradition in the area of disarmament, and we cooperate very closely at the UN. Ireland is currently engaged in work to support the peace process in Colombia, drawing on the lessons learned in Northern Ireland.”
Work on these Strategies will now begin in the Department of Foreign Affairs and Trade under Minister Flanagan’s direction and will sit within the broader Government strategy on Trade, Tourism and Investment.
ENDS
Press Office
25 October 2016
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