Country Profile: Ireland
Political, institutional and economic framework and important actors
After a period of remarkable economic growth, the Republic of Ireland has reached a level of
GDP per capita which exceeds European average. Ireland has become the second biggest high-technology exporter of Europe. But Ireland’s research intensity has remained at 1.20% of GDP in 2004, below EU average. In 2003, the business sector financed 59.1% of R&D expenditure (EU average: 54.3%). Ireland has an ‘open’ economy which is characterised by a high share of foreign direct investment and an external trade approximately equal to GNP.
Foreign sources account also for a considerable portion of R&D expenditure. Further characteristics which influence the National Science and Innovation System include a considerable disparity of the economic performance and structures of regions and the need to develop the innovation capacities of indigenous enterprises.
In 2004, one-third of foreign affiliates in Ireland (300 enterprises) were active in R&D. They accounted for two-thirds of all business R&D. Of these, 50% spent less than €500,000 annually.
Nineteen foreign affiliates spent more than €5 million annually and accounted for two- thirds of all R&D performed by foreign affiliates in Ireland. One-third of indigenous enterprises
(1,000 enterprises) had some expenditure on R&D, with 85% spending less than
€500,000 per annum. Only twenty six of the 1,000 indigenous enterprises had expenditure of more than €2 million annually1. A recent core policy document summarises the challenges which this situation constitutes:
“Ireland is vulnerable in the growth sectors of the knowledge economy as the R&D capability to underpin success in these sectors is not well developed in the public and private sectors. Sustainable economic growth will be dependent on the success of