Speculation is growing that Britain’s largest bank, HSBC, is to move its headquarters to Dublin in order to take advantage of the better business conditions in Ireland.
Chris Spooner, HSBC’s head of financial planning and tax, has pointed out that the bank could save as much as £400 million (€594million) by locating its global headquarters outside Britain.
The financial services sector is a hugely important sector in the Irish economy, contributing over 5% to Ireland’s GDP as well as directly employing in excess of 50,000 people. This week, the Government agreed to a major modernisation of legislation governing the regulation of the industry as part of its Better Regulation Agenda, to make the country even more “capital friendly”.
Currently, international bank assets in the IFSC are worth over 330 billion euros while net asset values of domiciled domestic funds are tipping 500 billion.
Earlier this year, Taoiseach Bertie Ahern attended the opening ceremony of HSBC’s fund administration and training centre in Sandyford, Dublin.
‘‘I hope you make a fortune here.” he told HSBC chairman Sir John Bond. Can’t get much more capital friendly than that.
To achieve this step up into the big league, Ireland needs university graduates from all over the globe, which is why Financial Services Ireland (FSI) have already called on the Government to adopt special migration policy measures for the financial sector to allow non-EU nationals to enter the Irish labour market.
“Financial sector employment has grown by over 50% over the last eight years and it is forecast that this figure will increase by a further 75% by 2020,” FSI Director, Aileen O’Donoghue, told her organisation’s annual conference last month.
“This is phenomenal growth by any standards and it will outpace other sectors of the economy. Overall Ireland will need approximately 700,000 people with third level qualifications in employment by 2010. Current estimates suggest that we will need around 300,000 new graduates over the next five years to reach that target. This is a massive challenge and it is important for the growth of the financial sector that we achieve it.”
This all seems to echo the view of John Herlihy, director of Google’s online sales and operations in Europe.
“Dublin has become a melting pot for young people where 160 languages are being spoken,” Herlihy said when announcing Google would hire 500 more employees in Dublin as it makes its Irish facility the largest outside the United States.
Like others, he said that Ireland’s low 12.5 percent corporate tax rate had helped Google decide to base its European operations there. But he said that the company had also found that people with desirable language skills were willing to relocate to the Irish capital.
Hard for locals to believe as they sit in their cars for hours on end but probably something to do with the fact that Ireland has been rated by the Economist as the country with the best quality of life on the planet.