Ireland - Market Challenges Ireland - Market Challenges
In June 2016, the United Kingdom voted to leave the EU. At the time of writing, the conditions under which the U.K. will leave the EU are unclear. Whatever shape it takes, Ireland is expected to be the country most impacted by ‘Brexit’ as the UK is its largest trading partner in Europe and shares a land border with Northern Ireland. Any negative effects on the Irish economy is likely to have an adverse impact on the demand for U.S. products and services.
Irish companies are being strongly encouraged to expand their export strategies to reach a more diverse range of markets. Additional government supports are being put in place for SMEs to expand their export strategies. A knock-on positive effect is emerging with more interest by Irish companies to looking west to the U.S. for investment opportunities.
Ireland has yet to experience any significant impact from U.S. tax and regulatory reform as a competitive measure to re-shore U.S. companies back to the United States. Against the backdrop of a proposed common consolidated corporate tax base (CCCTB) in the EU and a digital sales tax, Ireland remains steadfast with its commitment to a 12.5 percent corporate tax rate and therefore an attractive investment destination for American companies with a global reach.
Project Ireland 2040 outlines the Irish government’s plan to provide for regional development and to improve the State’s infrastructure. The plan is based on the premise that one million extra people will be living in Ireland in 25 years’ time. While there are calls from industry groups for an increase in capital spending, suppliers continue to face significant price pressures at current levels when doing business with the public sector. Strong competition from Irish and European suppliers dictates that U.S. exporters must offer a combination of innovative and high-quality products at competitive prices.