Nicknamed the Celtic Tiger for its economic boom between the mid-90s until 2000, Ireland continues to ride the wave of foreign investment and low corporate tax. Ireland’s stellar growth has had its own challenges though, like the economic recession, Brexit and more recently, the pandemic, which has shaken the global economy.
Amidst all this chaos, how does the Republic of Ireland fare in terms of reputation and competitiveness, and how does Ireland perform as a nation brand?
Let’s take a closer look at:
- Ease of doing business in Ireland;
- Ireland’s global competitiveness and talent attraction potential;
- The environmental performance and tourism in Ireland;
- Quality of life in Ireland and its performance as a ‘Good Country’;
- The soft power of Ireland and the value of its nation brand
Doing business in Ireland
How easy is it to start a business in Ireland, and how competitive is the country’s financial market?
According to Institute for Management Development’s World Competitiveness Yearbook 2021, Ireland is in the 13th position compared to 64 countries for its economic competitiveness, an improvement from 20th position last year. Ireland’s strong points are in Government Efficiency (13th) and Business Efficiency (11th), with room for improvement regarding its Economic Performance (22nd) and Infrastructure (20th).
Ireland is a favourable place to do business, as it is ranked 24th in the latest World Bank Ease of Doing Business 2020 report – just one place below last year. The study points out that obtaining contracts from the government is not efficient as the public procurement lifecycle has several bottlenecks taking as long as 120 days and delays in contract execution cost Ireland a whopping 153 days, which is an impediment in making better use of taxpayer’s money.
Ireland’s reputation for being business-friendly is further established by its 23rd place worldwide in the latest U.S. News Best Countries Overall Rankings 2021. Ireland stands 8th globally in the Open for Business sub ranking, which factors in attributes like the favourable tax environment, bureaucracy, low corruption, and transparent government practices. There is room for improvement in the Entrepreneurship sub ranking though, currently in 23rd position.
Ireland’s low corporate tax regime of 12.5% has made it a beehive for international MNEs to set up their European headquarters. But this might set to change, following the recent call for a global minimum corporate tax of 15%. While a majority of countries have agreed to adopt this new rule to implement fair taxation of big profitable companies, Ireland is among the very few countries that are yet to be signatories of the new global tax. How this affects Ireland’s stance/image as a multinational investment destination in future years remains to be seen.
Though Ireland has a stable economy and steady availability of young and multilingual talent, among other benefits, any change in taxation in the US has a bearing on Ireland’s FDI climate.
According to UNCTAD’s World Investment Report 2020, FDI inflows saw a sharp spike from USD -28 billion in 2018 to USD 78 billion in 2019. This is due to the repatriation of offshore profits by US multinationals, following a US tax reform. This is evident in Ireland rising from the 189th position in FDI inflow ranking in 2018 to the 5th position in 2019, just behind the USA, China, Singapore, and the Netherlands. It is currently in the 8th position in 2020 among the top 20 large recipients of FDI worldwide, overtaken by four spots by Hong Kong, India, Luxembourg, and Germany.
Ireland has climbed one position higher to take the 13th place worldwide in the latest Bloom Consulting Country Brand Ranking© Trade for 2019-2020 from its 14th place in the previous edition. It has remained in the 5th position among its European peers with the UK, France, and Germany firmly taking the top 3 positions.
The annual European Innovation Scoreboard (EIS) that provides a comparative assessment of research and innovation performance of countries considers Ireland as a Strong Innovator with innovation performance above or close to the EU average. Although over time, Ireland’s performance relative to the EU has decreased strongly, in particular in the last three years.
According to this 2021 report, Ireland’s strengths lie in Linkages, Human resources and Attractive research systems. The decline in innovation performance in the last two years is due to reduced performance on Government support for business R&D, Business R&D expenditures, Employment in innovative enterprises, Sales of innovative products, and Environment-related technologies.
Ireland is showing below-average scores on Climate change-related indicators, due to a low score on the Circular material use rate.
Transparency International’s latest 2020 Corruption Perceptions Index ranks Ireland 20th (18th in 2019) among the 180 countries and territories for their perceived levels of public sector corruption. On a scale of 1 to 100 with 100 being very clean, Ireland scores 72/100 compared to 74 in 2019.
Is Ireland a ‘good country’?
How much does Ireland contribute to global well-being?
When the Good Country Index was released for the first time in 2014, Ireland had the distinction of being the ‘goodest’ country in the world, as explained by Simon Anholt here. It won this recognition for contributing the most to the common good of humanity and the planet. Fast forward to the latest 2020 report, Ireland has slipped to 15th.
Ireland stands 2nd in its global contribution towards International Peace and Security, 11th in Health and Wellbeing and 16th in World Order. Its decline in global standing can be attributed to its subpar ratings by the global community towards Ireland’s contribution in Science and Technology (37th), Culture (22nd), Planet and Climate (31st), and Prosperity and Equality (81st).
Ireland’s environmental sustainability
How well does Ireland look after its natural environment?
Fondly called the Emerald Isle for its lush green countryside, Ireland is blessed with immense natural beauty. But how well are the Irish safeguarding their environment and what sustainability measures have they adopted?
According to the Happy Planet Index Ireland achieves a score of 30.0 and ranks 48th among the 140 countries analysed. Ireland ranks highly for both life expectancy and wellbeing, appearing in the top 20. Ireland performs poorly with respect to its ecological footprint, much like its developed European counterparts.
The recent 2020 Environmental Performance Index, which compares and analyses environmental performance and the state of sustainability, has ranked Ireland the 16th among 180 countries, a steep decline from its 9th position in 2018. Ireland’s fall can be attributed to nations in the global west like Finland, Australia, Spain, Norway, Germany, Switzerland, Belgium, Germany and Japan overtaking Ireland by investing in the necessary infrastructure to improve the environmental health and the well-being of citizens.
Ireland needs to come up with a sustainable trajectory with strict measures to improve its Ecosystem services (rank 125th), Biodiversity & Habitat (73rd), and Fisheries (102nd).
On the brighter side, Ireland has taken significant steps and invested in policies and programs to improve the air and water quality. It shows strong results in decreasing the emissions of primary pollutants (ranks 1st), air quality (8th), reduction of greenhouse gases (31st), sanitation and drinking water (13th), and wastewater treatment (14th).
According to the Sustainable Development Report 2021, Ireland’s progress made towards the UN’s 17 Sustainable Development Goals (SDGs) improved by one position from 14th place in 2020 to 13th place in 2021. Ireland scores 81 out of 100, which is a good score for its efforts but needs to make progress in fighting hunger and fostering global partnership for sustainable development.
Ireland’s soft power
How much global influence does Ireland have thanks to its culture, education and enterprising?
Brand Finance’s Global Soft Power Index 2021 ranks Ireland 29th compared to its 24th position in 2020. The slip down the index can be attributed to the increase in the number of countries being analysed, especially from Latin America and Africa who could be less familiar with Ireland in general. Ireland’s poor performance in the culture and heritage soft pillar is a significant effect on its rankings. But Ireland’s reputation in the Business & Trade pillar is unscathed for its ease of doing business, and its strong and stable economy.
The Soft Power 30 Index for 2019 ranks Ireland in the 20th position, almost identical to its 19th spot in 2018. Ireland lags behind in the Digital, Education, Culture and Engagement sub-indices but is saved by the Government sub-index which is one of the country’s strongest areas resulting from continuing economic growth, net immigration, high standard of living, and employment.
The FutureBrand Country Index that measures the strength of perception of countries around the world ranked Ireland in 33rd place in 2019. Switch to 2020, Ireland has made a leap to 26th place, an improvement in seven places signifying a resilient country brand even in times of a pandemic.
Quality of life
According to OECD’s Better Life Index, Ireland performs well in categories like housing, healthcare, community support system, and environment that make living in Ireland a pleasant experience. Among all the OECD countries, Irish people are more satisfied with their lives than the OECD average. When asked to rate their general satisfaction with life on a scale from 0 to 10, Irish people gave it a 7.0 grade on average, higher than the OECD average of 6.5.
In the World Economic Forum Social Mobility Index 2020 edition, Ireland ranks 18th among the 82 global economies benchmarked. Among the ten pillars assessed, Ireland fares well in Health, Technology Access and Inclusive Institutions but lacks significantly in sub pillars like Fair Wage Distribution and Lifelong Learning.
Internations’ Expat Inside 2019 survey called Ireland’s 43rd ranking its worst-ever performance for the difficulties expats face in Ease of Settling, Feeling at Home and Culture factors. Whereas in the Expat Inside 2021 survey, Ireland rose to the 29th position, a significant improvement from the previous year, standing 1st in the Career Prospects and Satisfaction index for its impressive career opportunities.
The World Happiness Report 2021 ranks Ireland in 15th place among 149 countries worldwide. Institute for Economics & Peace’s 2020 Global Peace Index ranks Ireland the 12th most peaceful country among 163 independent states and territories worldwide. In Vision of Humanity’s Global Terrorism Index 2020, Ireland is ranked 62nd worldwide and is in the 9th position in Europe with a GTI score of 2.845 an increase in 7 spots from the past year.
Education
Ireland is in the global top 15 in the latest Global Talent Competitiveness Index 2020 compiled by INSEAD, the Adecco Group, and Google Inc.
Ranked 15th among 132 countries, its key strength lies in Attract (9th) owing to high scores in the FDI and technology transfer (ranks 1st), the prevalence of foreign ownership (7th), tolerance of minorities (1st), tolerance of immigrants (8th) sup pillars. There is scope for improvement with respect to enabling talent (rank 21st).
Tourism in Ireland
Ireland’s picturesque landscape, which earned it the title of an Emerald Isle, is worthy of a bucket list destination. So how does Ireland rank compared to other beautiful destinations around the world?
Ireland is one of the top 10 countries in the world for experiences, according to the World’s Best Destinations For Travel Experiences ratings from the global TripAdvisor community. Ireland is the 4th best country in the world and 1st in Europe for the travel experiences it offers, with an average country rating of 4.57 out of 5.
According to the latest Bloom Consulting Country Brand Ranking© Tourism for 2019 – 2020 Ireland holds the 21st position, up from the 26th position in the 2017-2018 edition. Ireland is a new entrant in this year’s Top 25 global ranking and this climb in five spots is attributed to an improvement in its D2-Digital Demand© search (the total amount of searches performed by all worldwide citizens) and its CBS Rating© (Ireland’s strategic positioning of its National Tourism Organization) respectively.
The Travel & Tourism Competitiveness Index 2019 ranks Ireland in the 26th position among the 140 countries that are compared, a fall in three positions from the previous 2017 report.
The country ranks first among European nations and 9th globally for its International Openness with regard to visa requirements, openness to bilateral air service agreements and quantity of regional trade agreements. However, it ranks far behind (126th position) for Price Competitiveness. In other words, travelling to and in Ireland is relatively expensive.
Ireland as a nation brand
How valuable is Ireland as a nation brand?
Brand Finance’s latest Nation Brand 2020 study places Ireland in the 19th position, up by seven places from the 26th spot in 2019. This evaluation of the strongest and the most valuable brands has placed Ireland in the limelight for being the only nation brand in the global top 20 to record brand value growth, up 11% to USD 670 billion.
Ireland boasts of a vibrant and resilient economy having weathered the twin storms of Brexit and the COVID-19 pandemic.
Analysis by Supriya A N. Last updated July 2021.
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