Ireland reassures Chinese investors

Infrastructure projects good targets, says PM

Irish Prime Minister Enda Kenny said confidence is returning to his country's economy and investing in Ireland will be rewarding for Chinese investors, despite worrying signs from recent statistics.

Irish Prime Minister Enda Kenny says there are many opportunities for Chinese companies in Ireland. Wu Zhiyi / China Daily

Wrapping up his first-ever China visit, which took him to Shanghai and Beijing in the last four days, Kenny gave a nod when asked if he thought that China could gain access to high technology by investing in Europe.

"Yes, I do, and many of the high-tech specialists in Ireland actually offer technology that would be complementary and beneficial for China," Kenny said. He cited Europe's programs for urbanization, water, environment and renewable energy as examples.

He was speaking a day after an agreement was signed between the National Treasury Management Agency of Ireland and China Investment Corporation International, a subsidiary of China's sovereign wealth fund.

"The prospect of substantial Chinese investment in Ireland, possibly including the purchase of Irish state assets, has increased," The Irish Times commented Wednesday.

China is already in talks with the Irish government on bids for infrastructure projects in the debt-stricken European nation, which plans to sell part of its publicly owned assets to pay off loans, said Barry O'Leary, chief executive officer of Investment and Development Agency Ireland.

"There are enough opportunities for Chinese companies to invest in infrastructure in Ireland. We have a lot of infrastructure that is publicly owned, and part of it is going to be sold in the next two to three years," said O'Leary, who was part of Kenny's delegation.

"They (the assets) are valued at 3 billion euros ($4 billion), including energy, gas, electricity, ports, roads and water," O'Leary added.

With the world's largest volume of foreign exchange reserves, China is encouraging companies to make purchases overseas. And the European debt crisis is widely seen as an opportunity to buy up assets in the developed region.

In December, China's Three Gorges Corporation bought a 21 percent stake in Portuguese utility EDP.

But even though Ireland is "one of the most open economies in the world", what Kenny may need to do first is to try to make Chinese investors confident about investing in the country, because recent statistics don't look promising.

The Central Statistics Office of Ireland said last week that GDP fell 0.2 percent in the October-December quarter. That came on top of a 1.1 percent decline in the previous quarter.

For 2011 as a whole, Irish GDP grew 0.7 percent but underlying GNP fell 2.5 percent. Irish GDP has fallen for three straight years: 3 percent in 2008, 7 percent in 2009 and 0.4 percent in 2010.

Despite these statistics, Kenny said: "The fact is that employment has been stabilized and is starting to grow. Our own figures for 1.3 percent growth for next year are based on medium-term assessments."

The unemployment rate in Ireland stands at 14.5 percent, meaning that 439,600 Irish people are out of work, the Irish Voice newspaper reported in mid-February. Kenny's government then unveiled an ambitious action plan to create 200,000 jobs in eight years.

"For the first time in a decade we have a balance of trade surplus. We have deposits flowing back into our banks. We have very strong investment lines into the country. Our exports are booming. Confidence is returning to the Irish economy," he said.

Irish exports to China exceeded $4 billion in 2011, up 6 percent on the previous year, IrishCentral.com reported.

Enterprise Ireland, the country's state enterprise agency responsible for the promotion of indigenous enterprises, has said that Irish-owned firms were responsible for 6.4 percent of Irish exports to China in 2011.

It announced that indigenous Irish exports to China grew by 10 percent in 2011, for the second year in a row, and the agency is aiming for a further 15 percent growth in 2012.

Kenny said Ireland could increase exports to China in many sectors, including life sciences, the agri-sector, science and technology, and culture and education.

In terms of what China could do in Ireland, Kenny mentioned "the development of further infrastructure in Ireland, tourism and investment, and also the acquisition of commercial properties for investment and development".

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