From Socialist Voice, July 2005

Ireland no longer so attractive to foreign capital

Foreign direct investment in the Republic fell by nearly 50 per cent last year, according to a report by the OECD. It was $14.6 billion in 2004, down from $26.9 billion in the previous year. The current levels are similar to 2001.
    In contrast, direct investment by Irish companies abroad has been climbing rapidly, from $3.5 billion to $11.4 billion in 2004. The amount of inward investment is just keeping abreast of the outward flow of profits by the Irish capitalist class, in addition to the massive outflows of profits made by foreign transnationals.
    Cumulative inflows of FDI into the Republic over the decade up to 2004 amounted to $139.3 billion, or the eleventh-biggest total out of twenty-nine OECD countries. Irish companies invested $46.6 billion abroad over the same period; this was the sixteenth-biggest investment out of the same twenty-nine countries over the same decade.
    This reduction of FDI into the Republic occurred as outflows from the United States reached a record of $252 billion. The Republic was one of the major beneficiaries of American direct investment for the last couple of decades. China and India are the new preferred destinations, at $55 billion, up from $47 billion in 2003.
    The wealth being created by Irish workers is flowing out of the country at an alarming rate. Clearly low corporate taxes and incentives from the government are not enough. Capitalism has no loyalty other than to making greater and greater profits, in the never-ending search for new areas to exploit and ever-cheaper labour to use.
    The outflow of profit exposes the high return on investment that both foreign and Irish companies get from Irish workers. It is clear that we are over-exposed to FDI fluctuation. As we continue to sell off publicly owned companies, our ability to create jobs and to sustain economic stability becomes ever more precarious.
    We need to control the flows of capital out of the country, to stop privatisation, and to expand the state sector, not contract it.
    If we are to seek foreign investment, we should be looking for those sectors that require a high-skill, technological base.

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