Rise in jobs in Ireland's financial services after Brexit.
'Ireland is now home to many global financial giants, many of whom have chosen it as their EMEA (Europe, Middle East, Africa) head-quarters,' the paper says. 'Post Brexit, Ireland experienced a further influx of IFS (International Financial Services) firms relocating from the UK.
Financial services is one of the largest sectors in the UK economy too. It employs 1.2 million people across the country. It is also one of the UK's most internationally facing sectors: the UK is the world's largest net exporter of financial services and the sector accounts for more than half of the UK's surplus in services export.
The Department of Finance in Ireland concedes that the Brexit bounce is probably over, and the financial sector will have to look for other ways to develop in the face of mounting international competition for investment.
'The benefits from Brexit relocations, one of the drivers of growth in the sector in recent years, will likely be limited in the future,' the paper says. 'Competition from growing international financial services hubs, such as Singapore and Dubai, is increasing.'
Among the other challenges are the green transition, which has led to both Ireland and the European Union making promises on climate and sustainability objectives, which the financial services sector will have to assist with, by channelling investment towards appropriate projects. Another challenge is to lure more household savings from bank accounts into 'productive investments'.
The consultation process launched by the Department is to prepare a new 'Ireland for Finance' strategy to develop the international financial services sector.
The strategy began in 1987 under the then Taoiseach (prime minister), Charles Haughey, acting on the advice of businessman Dermot Desmond. He introduced policy supports and tax breaks to attract IFS activity into Ireland, and the strategy was so successful that it gradually transformed the country into a globally important hub.
The consultation paper says Ireland now hosts about 600 IFS companies, and is the sixth-largest exporter of financial services globally, and the third largest domicile for funds.
'Ireland's market share has continuously grown over decades, as specialisation and expertise in various areas has developed. Ireland is now home to some of the world's largest IFS companies in sub-sectors such as banking, funds, asset management, insurance and reinsurance, fintech, and aircraft leasing,' it says.
Leveraging off the presence of global tech firms, the country has become a hub for payments firms, and a specialist hub for aircraft leasing, with over 60 per cent of the world's leased aircraft managed from Ireland.
A report by Indecon last year on the impact of the funds and asset management industry concluded that the sector provided almost one billion euros in direct tax revenue in 2023 alone.
The Programme for Government set a target of 9,000 new jobs in the IFS sector by 2030. The new 'Ireland for Finance' strategy will aim to meet that, but the Department is cautioning that in the current economic climate, keeping the jobs we have is a key consideration.
A public consultation period will run until 19 September. Stakeholders are being asked for their views on how Ireland can expand the sector, but also to identify any barriers to competitiveness and growth.
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