Business Profile of Ireland Essay
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Ireland is an island located in the eastern part of the North Atlantic Ocean. Almost all the areas of the country are covered by coastal areas. The density of rainfall is much in the western part of the country that receives heavy which exceeds 3000 mm (120 inches) per year and only 60% of rainfall is received in remaining areas having 762 mm rainfall per year. The country is hugely populated with Christian’s community (Thompson, 1849). The official language of the country is English and mother tongue is Irish.
The education background of the country is that, 52.3% of the population are primary educated, 23.3% of the population are secondary and only 24.4% are t highly educate (Hall, 1995).
Ireland is one of the most emerging countries of the United Kingdom. It allows the enthusiastic entrepreneurs to commence small as well as medium sized industries which facilitates in the growth and prosperity of the country. For this the so many assistance were provided like financial assistance from both the sides of government body and other institutions, imposing tax at concession rate, simplified procedures for incorporating, economical tariffs and transportation costs. And other running costs prevailed is also lower compared to other parts of the UK. In addition to these the country is filled with energetic, enthusiastic, young, skilled and highly educated workforce.
Ireland is a developing country with a total population of 436, 6193 according to the survey carried out in 2007. Since1980, about 40% of the inward investment in the European Electronics sector has been contributed by Ireland (Hall, 1995). Now, it is being accepted as one of the growing countries in the world. Most of production functions are undertaken by the country itself and the well known software packages are designed in this country i.e. around 60% of the total software packages sold in different parts of the world.
It is also well known that for the software export in the world. Out of top 15 pharmaceutical companies, 13 companies have been manufacturing and conducting R&D operations in Ireland. It also has been a full member of Euro Currency Zone from its inception. It can also simplify the transactions including cross border transactions and other administrative costs that enables the Irish market to gain competitive advantage over costs and gets economies of scale. ‘The Doing Business Report’ reports that the country is ranked 7 out of 181 economies in terms of ease of doing business (Economy Ranking, 2008). The report also documents that the country is accepted as the 5th economy among the 181 economies across the world to start a new venture.
Source: (The Doing Business Report 2009, Economy Ranking, 2008)
The country’s political stability, risk assessment, administration and policy-making are very much feasible to the business people in domestic and their foreign policies are too favorable to the investors. Evaluating and anticipating the political stability and security to the business environment in Ireland, it can be said that the political stability of the country plays an important role in determining the entrance of new ventures in to their market. Their trade policies attract many new entrepreneurs to commence their business operations in the country.
Recent emergence of emigration, environmental risk and the affect of technological changes to the political agenda have been seen along with Ireland’s economic performance, their peace process, the policy areas of health, housing and industrial relations of the country. Economic growth rate since past decades of the country in terms of per capita GDP level showed a higher trend. The reason behind such development was imaginative i.e. the dynamic programs developed by Irish political and administrative leaders irrespective of the governing body mainly focused on the development of the country as a whole and not as an individual. Ireland’s good working condition and better relationship with the United Kingdom has enabled the two governments to achieve significant progress and developments in the country.
Comparative advantage of the country
When we are talking about the comparative advantage of the country it is necessary to evaluate the overall development of the country. There is a good sign in inflation rate which is showing decreasing trend from last decades, this resulted in increase in the purchasing power of the people and also the micro factors GDP and Per Capita of the country also showed a positive sign. In addition to these foreign exchange rate increased. This inspired more and more outside companies to establish their business in the country and increased the amount of contribution of the foreign companies in the country, this factor provided employment opportunities to the people of Ireland. The following are the various categories that offer large amount of employments to youth.
– Ireland Industries
– Ireland Hi tech
– Ireland real estate
– Ireland Services
The other comparative advantage of the country is the prevailing taxation policy of the country. It impose lower rate of taxation for existing industries as well as new industries. The policy of taxation is based on the individual income .In other words, higher the income higher the rate of tax payable. Companies those who are following the conditions as mentioned in the assessment year of July 1998, only 10% corporate tax will be applicable. This tax slab rate will remain unchanged till 2010. If it is a passive income only 25% is applicable (Cantillon, 2001).
Income tax imposed on individuals is also low as compared to other countries in the world. For an individual, tax will be payable according to income earned in Ireland and overseas who follows the requirements to become a resident of Ireland for. A foreign resident who is employed in Ireland is also liable to pay tax on income earned in Ireland. It is yet another comparative advantage over other countries. Besides this they are also preventing the levy of double tax to the foreign companies even though it is followed in other parts of the country. In addition to these advantages, the government of Ireland provides VISA to the foreigners to do business in their country.
In certain occasions they give passport having 3 months validity to the foreigners to stay. And a work permit will be given to the foreigners by the government if all the conditions in the gazette are complied by them. And suppose they are issued without fulfilling the conditions it will badly affect the employ Tax. They are liable to pay tax on income earned in Ireland and overseas by an individual who meets the test of a “permanent resident” of Ireland. A foreign resident who is employed in Ireland pays tax only on income earned in Ireland and not on overseas. The work permit is granted for the period of one year if required it can be extended.
The major industries of Ireland
The major industries located in Ireland are Agriculture, Beverages, Chemicals and Fertilizers, Clothing, Construction, Electronics and Data Processing, Food Processing, Machinery, Pharmaceuticals, Textiles, Tourism.
Major companies working in Ireland
Barry’s Tea Ltd
It is a privately owned company. It was founded in Republic of Ireland in 1901 whose headquarter is situated at Cork. The main products of the company are Tea. About 73 employees are working in the company. The annual turnover of the company is € 31 million.
It was founded in 1976 at Dublin, Ireland. About 12 employees are working in the company. The main products of the company are Public Key Infrastructure Solutions. The Company was acquired by Oryx International Growth Fund in July 2006.
The company was established in 1997 in Ireland. Paul Dowling is the current CEO of this company. Mainly they are producing electronic items. About 380 employees are working in the company.
It is one of the oldest and largest department stores at Dublin, Ireland. It was established in the year 1843 by Sir John Arnott. It is a privately owned company. € 750000000 is the asset of the company. Market capitalization of the company is US$13billion.