Why scrimping on trade missions a false economy

The rationale for public funding of trade missions has been challenged, and questions are being asked about the benefits of the “reduced programme” of government ministers’ involvement at international St Patrick’s Day celebrations.

This year just 10 Ministers’ trips (down from 27 last year) targeted international markets.

Done well, such trips can both generate immediate financial return and set a foundation for sustainable long-term export growth. As we begin to see the benefits of an economic recovery, now is the time to invest in growth, to establish new trading relationships and to build our national brand reputation as a source of quality products and services.

My experience of trade missions has been both as chairman of Bord Bia and as a business owner in the food sector. Without exception, my time invested in such trips has been well rewarded; securing new business, building relationships with new customers, learning a huge amount about new markets and cementing connections with Irish industry colleagues.

The heavy workload on a few days in a minister-led delegation can be exhausting. These trips cannot be described as junkets.

Some 41 per cent of all Irish food/drink exports reach the UK market, a heavy (and dangerous) dependency in light of a possible Brexit.

Trade missions are an important element in our efforts to broaden the base of markets. Exports are important for the food and drink sector (accounting for more than 90 per cent of all Irish production) reaching a record €10.8 billion last year, the sixth consecutive year of growth.

Our ambitious 10-year strategic plan for this industry, Foodwise 2025, sets an annual export target of €19 billion.

Realising such export growth (and the associated impact on employment, wealth creation and taxes) depends upon access to new markets. Huge potential exists in Asia and Africa with the world’s population is predicted to increase by 2.3 billion people in the next 35 years. Almost all of that growth will be in these emerging regions.

In these new markets we need to play every card we have, doing everything we can to punch above our weight. Arriving into a new high growth emerging market in regions such as Asia, Africa or the Middle East can be daunting. But when the visit is as part of a trade mission, led by a senior government minister, doors open wider and more quickly, supporting introductions and access at a senior level.

Trade missions

In the past few years, food sector ministerial-led trade missions have visited China, Middle East, US and Africa, and I’ve taken part in many of them. My experience has been of high work intensity and cost efficiency; of highly professional and hard-working delegates, from the private sector, government agencies, embassy commercial attaches and Department of Agriculture officials.

Like all other private sector participants, I’ve covered all expenses of such trips directly and the public sector employees are obsessed with avoiding excessive expenditure.

Last year I participated in a five-day trip to the Middle East. It was a tightly-packed, exhausting schedule of meetings with customers, agents, government officials and Irish diaspora, and three regional flights (mostly late in the evenings).

A clearly defined set of business objectives were agreed before the trip. Every evening, the leadership team – chaired by Minister Simon Coveney – met to review the achievements at each meeting and to confirm committed follow up actions.

Last year, food and drink exports to that region reached €385 million, with a target to reach €500 million by 2020, and there are now more Irish food brands on the shelves of Spinneys and Lulus supermarkets in the UAE than probably anywhere else outside the UK and Ireland.

Success

Such visits are not just about “making a sale”; immediate orders secured should not be the only measure of success. More importantly, these trips allow relationships to build with potential future customers and cements connections between the members of the Irish delegation.

One of the reasons the Irish food and drink sector has been such a driving force for the recovery of our economy has been the strength of the network, the ecosystem of stakeholders that nurtures the growth of businesses with potential.

That ecosystem is strengthened through time spent as a group on overseas trips.

Overseas missions led by ministers provide a remarkable opportunity. If focused on trade development, they can achieve an extraordinary return on investment, bonding relationships in core markets and extending our scope into important emerging regions.

Michael Carey is managing director of East Coast Bakehouse and chairman of Bord Bia