Time for Irish lessons

I read with great interest the article about the highly successful Irish experience in attracting foreign investments and the ideas of the Hellenic Center for Investment (ELKE) chairman, Mr Costas Bakouris, to apply the Irish model to Greece («Irish lessons on investments,» February 11). Seen in a regional perspective, the lack of foreign investment flows in Greece is not an exceptional case: Inward investments remain at a surprisingly low level in all the countries of Southeastern Europe. However, there is no apparent reason why Greece should not be as attractive for a foreign investor as other EU countries with small markets, such as Ireland. Making ELKE an efficient partner for foreign investors is an important step in the right direction, but the Irish lessons go further. Ireland’s highly developed educational system and transparent governance record have been important factors in attracting new investments in the high-technology sector, while more recently, digital telecommunications and tax advantages have enabled the country to become a «service hub» for the rest of Western Europe. The successful promotion of Ireland by the IDA (the Irish equivalent of ELKE) can also be explained by a comprehensive industrial development policy and a permanent consensus among the political parties in Ireland about the country’s economic priorities. We all know that it will take some time to bring Greece’s educational system and bureaucracy up to so-called «European» standards. Greece should now concentrate its efforts on creating the sort of environment in which the political parties and the economic and financial leaders of the country set aside their differences. A stable tax system, a national consensus on the importance of foreign investment and a tacit agreement to keep the economy out of party politics – these are important factors in creating a more attractive investment climate. Such a national consensus might also include a collective effort to attract more service industries and regional headquarters – if only to compensate for the natural movement of Greek industry into the Balkans where production costs tend to be lower. Not only Ireland, but also Holland, Belgium and Luxembourg show how a small economy can succeed in attracting investment to the service and financial sectors. Finally, one should be aware that the overall image of a country’s economy remains a major factor in investment decisions. Shifting the image of Greece from a summer holiday destination to that of an economic success story is not easy, but if the political will exists it can be done.

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