Ireland can be a top 20 global financial centre by 2025

As a country, we are emerging from a very difficult period. With the pandemic hopefully abating, now is the time to look forward and be ambitious.

Based on the success to date of Ireland’s financial services sector and its resilience during the Covid-19 crisis, we can take another giant leap and establish the country as a top 20 global financial centre by 2025, a 50 per cent improvement on where we currently stand. It is an ambitious but attainable goal, that will yield consumer choice, highly skilled professional careers, and increased tax revenues.

By creating new competitive advantages – counteracting changing corporate tax rates – Ireland can enhance its position as a premier location to attract financial services focused inward investment. This will introduce fresh capital and provide additional quality employment at a time when needed most. If we move quickly and decisively, the financial services sector will be well placed to secure global market share and bolster our national economy.

So, what do we need to do to achieve this ambitious goal?

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One of the first items is to accelerate and refresh is the Government strategy “Ireland for Finance”, to reflect the impact of Covid-19. The banking industry is consolidating across Europe. As news of Ulster Bank’s decision to exit the Irish market emerged, news also broke that Caixa Bank and Bankia were merging to create Spain’s biggest lender.

This trend is an opportunity for Ireland. Through our regulatory system, we should target the authorisation of international players in Ireland, rather than having financial institutions supervised elsewhere and provide services into Irish customers.

Nowhere is this more valid than the emerging fintech sector. Globally, fintech is where internet-based companies, such as Google, Facebook and Amazon, were 15 years ago – on the cusp of exponential growth.

Through this coming disruption, it is important to stress the critical and positive role fintech will play in the consumer experience, access to choice and competition.

Ireland can also emerge as an international hub for digitally enabled financial services. To start, we must foster greater collaboration and innovation between the unique blend of top-level financial services and technology leaders based in Ireland.

As with any sectoral growth plan, talent and skills development is fundamental. For Ireland to remain an attractive location for financial services, it is vital that we boost the talent pipeline to meet industry’s current and future needs. We are actively working to increase homegrown talent for the sector, through our second- and third-level education systems and continuous training and upskilling programmes, particularly the IFS Skillnet and IFS Apprenticeships. To future proof our talent development policy decisions, this year we are conducting the first skills-needs analysis for the sector in almost a decade.

We must also focus on attracting talent from abroad. Recent reforms to visa and work permits, along with system efficiency improvements, are very welcome. Cost of living, housing and quality of life challenges remain a sticking point. So, too, is the need to improve our national broadband infrastructure.

In addressing the skills needs for the sector, it is vital that our talent pool comes from as many diverse backgrounds as possible. Ireland has undergone a transformation to become a beacon of diversity and culture in recent years. This is something we see as central to growing the financial services sector here. Diversity of thought is a challenge for the sector globally.

However, Ireland has the chance to be a front runner in tackling this societal and business imperative. Through initiatives from groups such as 100 Women in Finance, the 30% Club, Fusion, Open Doors and Balance for Better Business, we can create a new competitive advantage.

Climate

No plan for growth would be complete without addressing the existential matter of climate change. Through the financial services sector, Ireland has a dual opportunity to harness the climate challenge for growth.

Firstly, at a national level, sustainable finance products will fundamentally support Ireland in meeting its climate action targets.

Secondly, Ireland can become an international destination for the sustainable finance operations of global corporations. Again, talent and skills availability in this specialised area will be key.

Underpinning all these focus areas for growth – technology, consumer choice, talent, diversity and sustainability – is Ireland’s financial services regulatory system. Regulatory robustness is a crucial component for the financial services sector, alongside efficient and fluid engagement between the regulator and those it regulates. This fundamentally influences the success of both the sector and the wider economy.

Through the structures of the Central Bank of Ireland, we have the essential components needed for a positive, robust and effective regulatory ecosystem. In this, we especially welcome the current work by the Central Bank to establish an engagement forum between industry and the regulator, to discuss both challenges and opportunities.

For a small country on the edge of Europe, Ireland has always punched above its weight in many sectors. This has been the case in financial services for some time. In 1987 the IFSC began with fewer than 100 employees in the Dublin docklands. There are now more than 9,000 financial services companies operating throughout Ireland, an increase of 36 per cent since 2014, employing more than 105,000 people, up 60 per cent from 2004. We have proved we can be ambitious.

The financial services industry is no longer a single location, single talent type marketplace.

Success is no longer a function of being global but is much more dependent on being skilled in very many directions. With the right decisions, Ireland is poised to catapult our contribution to a global financial services industry. We should grasp this opportunity.

Paul Sweetman is director of Ibec’s Financial Services Ireland